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HomeTechChina pumps $1.9 billion into homegrown chip-making firm YMTC

China pumps $1.9 billion into homegrown chip-making firm YMTC


China will invest another $1.9 billion in Yangtze Memory Technologies Co. (YMTC), the country’s largest memory chip maker, to boost growth in its domestic semiconductor industry, currently hampered by US sanctions.

China’s National Integrated Circuit Industry Investment Fund, a government-backed investment body also known as the Big Fund, will inject capital into YMTCBloomberg reported Friday. The size of the investment demonstrates China’s efforts to boost its struggling domestic chip industry, which is currently facing restrictions on its manufacturing capabilities from the US and other countries.

China’s quest for self-reliance

Last month, the Political Bureau of the Central Committee of the Communist Party of China led the third collective study on strengthening fundamental researchaccording to a report from Xinhua News Agency.

In the group study, Chinese President Xi Jinping urged the country to accelerate scientific research so it can become self-sufficient in vital technologies, the report said.
The president stressed that the party committees and government at all levels should strengthen basic research, improve overall coordination, increase policy support, and promote high-quality research development.

The Chinese Academy of Sciences has also presented a plan to create a semiconductor industry in China that could thwart US sanctions.

The study on strengthening basic capacity for semiconductor research outlines China’s vision of how to win the technology war with the US.

US steps up trade bans against China

China focuses on self-reliance while the US tries to prevent Western technology from being used to modernize the Chinese military. On Thursday, the Biden administration added 37 more entities to one trade blocklistincluding parts from Chinese cloud computing company Inspur.

The organizations were added for, among other things, contributing to Russia’s military and/or defense industrial base, supporting the military modernization of the PRC, and facilitating or engaging in human rights violations in Burma and the People’s Republic of China ( PRC). The US Department of Commerce said in a statement.

“When we identify entities that pose a national security or foreign policy concern to the United States, we add them to the Entity List to ensure we can closely scrutinize their transactions,” said Assistant Secretary of Commerce Thea. D. Roseman Kendler.

The trade department accused Inspur of procuring and attempting to buy US goods to support China’s military modernization efforts.

In early October, the US issued export controls that prevented US companies from selling advanced semiconductors and equipment needed to make them to some Chinese manufacturers unless they get a special permit.

In mid-December, the government expanded those restrictions to allow another 36 Chinese chipmakers access to U.S. chip technology, including Yangtze Memory Technologies Corporation (YMTC), the target of the Chinese government’s latest investment.

Now, the latest move by the US may add even more tension to the already strained relationship with China.

Copyright © 2023 IDG Communications, Inc.

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