Is a centuries-long trend of globalization reaching its limits? While the world still operates as one big marketplace, where consumers can easily purchase goods from different continents as if they were in a local supermarket, major powers are taking steps toward autonomy. The U.S. and China, imposing sanctions on each other’s goods and restricting the export of critical materials, are prime examples of this. Europe, occasionally caught between these global powers, is trying to craft its own form of strategic autonomy.
In this global economic and geopolitical struggle, it all comes down to producing the chips that can power our artificial intelligence applications.
After centuries of globalization, there are increasing signs of a trend towards strategic autonomy on all continents. In China, efforts are being made to find alternative solutions for banned chip-making machines.
In light of U.S. sanctions, China is determined to become self-sufficient in the semiconductor field by exploring ways to produce its own High-Bandwidth Memory (HBM) chips for artificial intelligence processors. This endeavor is indeed a challenge but is seen as crucial by the Chinese government. ChangXin Memory Technologies (CXMT), China’s best prospect for HBMs, may need up to four years to introduce these products.
Despite lagging behind global leaders like SK Hynix, Samsung Electronics, and Micron Technology, China could force a breakthrough in HBM production by leveraging its expertise in high-density packaging technologies. The need for steps like these is immense: the demand for HBM chips, which greatly increase data transfer speeds, is expected to rise by nearly 60% in 2023 alone.
China’s Quest for Self-Sufficiency
China’s determination to achieve self-sufficiency in semiconductors is not a sudden whim but a strategic necessity arising from the emerging geopolitical reality. As semiconductor technology forms the foundation for everything from consumer electronics to military hardware, control over the supply chain of these tiny chips is equivalent to control over the levers of power in the 21st-century economy.
U.S. sanctions have not only hindered China’s access to high-quality semiconductors but have also acted as a catalyst for the country to accelerate the development of its domestic semiconductor industry. China’s ambition to produce its own HBM chips is a manifestation of this broader strategy. The Chinese government is heavily investing in semiconductor research and development in an attempt to catch up with global leaders.