To overcome the restrictions from the US and its allies, China is said to be heavily investing in semiconductor development. According to a report from Liberty Times Net, Huawei has completed its “Lianqiu Lake R&D Center” with a total investment exceeding CNY 10 billion (approximately USD 1.4 billion).

EE Times China further reported that Huawei’s “Lianqiu Lake R&D Center,” covering an area of 2,400 acres and a total construction area of 2.06 million square meters, has finally unveiled its mysterious veil after three years of construction.

This research center is designed with 40,000 offices and is expected to gradually attract about 35,000 Huawei R&D talents. It is divided into eight zones, with fully connected internal roads, a miniature train system, and elevated bridges. The park’s transportation includes a miniature train system with a total of eight stations. Once fully completed, Huawei plans to relocate its existing Shanghai R&D base in Jinqiao and other scattered office spaces to the ” Lianqiu Lake R&D Center.”

According to the reported plan, the R&D Center will consolidate Huawei’s research efforts in HiSilicon, wireless technology, flagship smartphone development, smart driving/automotive components, digital energy, and other areas. This move aims to provide advantageous support for Huawei’s expanding businesses such as 5G/6G, digital energy, and smart automotive solutions.

Regarding Huawei’s substantial investment in building this research center, tech media outlet “Tom’s Hardware” highlighted on July 14th that amid the US-China semiconductor rivalry and various US sanctions against Huawei, the company must bolster its research and development efforts. Consolidating multiple research centers allows Huawei to streamline operations and facilitate easier collaboration among different departments.

The report states that this flagship project showcases Huawei’s investment commitment in future technologies. The “Lianqiu Lake R&D Center” is larger in scale than the combined size of Apple Park and Microsoft’s Redmond Campus headquarters in Seattle.

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• [News] Huawei and XMC Collaborate to Develop HBM, Looking to Break Through U.S. Sanctions
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(Photo credit: Huawei)

According to a report from Tom’s Hardware, it’s reported that one of GPU giant NVIDIA’s key advantages in data centers is not only its leading GPUs for AI and HPC computing but also its effective scaling of data center processors using its own hardware and software. To compete with NVIDIA’s CUDA, Chinese GPU manufacturer Moore Threads has developed networking technology aimed at achieving the same horizontal scaling of GPU compute power with its related clusters, addressing market demands.

Moore Threads was founded in 2020 by former senior executives from NVIDIA China. After being blacklisted due to U.S. export restrictions, they were unable to access advanced manufacturing processes but continued to develop gaming GPUs.

Per another report from South China Morning Post, Moore Threads has upgraded the AI KUAE data center servers, with a single cluster connecting up to 10,000 GPUs. The KUAE data center server integrates eight MTT S4000 GPUs, designed for training and running large language models and interconnected using MTLink network technology, similar to NVIDIA’s NVLink.

These GPUs use the MUSA architecture, featuring 128 tensor cores and 48GB of GDDR6 memory with a bandwidth of 768GB/s. A cluster with 10,000 GPUs can have 1,280,000 tensor cores, though the actual performance depends on various factors.

However, Moore Threads’ products still lag behind NVIDIA’s GPUs in performance. Even NVIDIA’s 2020 A100 80GB GPU significantly outperforms the MTT S4000 in computing power.

Moore Threads has established strategic partnerships with major telecommunications companies like China Mobile and China Unicom, as well as with China Energy Engineering Group and Big Data Technology Co., Ltd., to develop three new computing clusters aimed at boosting China’s AI development.

Recently, Moore Threads completed a new round of financing, raising CNY 2.5 billion (roughly USD 343.7 million) to support its expansion plans and technological development. However, the inability to access advanced processes from TSMC, Intel, and Samsung presents significant challenges for developing next-generation GPUs.

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• [News] ASML Former CEO Predicts Chip War Between China and the US May Persist for Decades
• [News] US to Lobby Netherlands and Japan to Contain China’s Chip Development, Focusing on HBM

(Photo credit: Moore Threads)

The China Association for Science and Technology (CAST) recently listed challenges facing China’s semiconductor industry. However, the list did not include lithography. According to a report from TechNews, it’s believed that the move to exclude lithography is more of a political consideration aimed at downplaying the impact of US sanctions on China’s local chip manufacturing industry rather than fostering innovation in lithography equipment within China.

Reportedly, Chinese leader Xi Jinping once told the Dutch Prime Minister that China does not need the help from ASML, the world’s leading advanced lithography system manufacturer, to drive its technological development. Currently, Shanghai Micro Electronics (SMEE) and Naura Technology Group in China aim to develop exposure equipment for the first time by April 2024.

However, regarding in the overall semiconductor manufacturing process in China, the production rate of Chinese chip manufacturing equipment is only 20%, with a global market share of less than 1%. In contrast, ASML holds a global market share of 93%.

EUV (Extreme Ultraviolet) lithography equipment is crucial for manufacturing next-generation chips. Even if Chinese companies had obtained these devices before US sanctions, they still require ongoing maintenance and support. The US ban has cut off this supply line, meaning the currently used exposure equipment will eventually cease to operate.

Unless China makes significant breakthroughs in the semiconductor lithography equipment industry, it will face many obstacles in advanced processes. Some industry leaders have already urged their companies to focus on traditional chips and 3D packaging rather than attempting to continue with advanced processes.

Currently, many companies are still striving to circumvent Washington’s sanctions. For instance, Huawei is establishing a major research and development center for exposure and wafer fabrication equipment. Yet, per an earlier report from Reuters, Peter Wennink, former CEO of ASML, stated in an interview that the chip war between China and the US will not be resolved anytime soon and could potentially persist for decades.

Other Chinese companies are also exploring open standard technologies like RISC-V. However, given the current situation, it could take China several years, if not decades, of research and development to catch up with mainstream exposure equipment manufacturers.

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• [News] ASML Former CEO Predicts Chip War Between China and the US May Persist for Decades
• [News] US to Lobby Netherlands and Japan to Contain China’s Chip Development, Focusing on HBM

(Photo credit: ASML)

Peter Wennink, former CEO of ASML, recently stated in an interview with Dutch broadcaster BNR that the chip war between China and the US lacks factual basis and is entirely driven by ideology. According to reports from Reuters and the Commercial Times, Wennink also anticipated that this chip war will not be resolved anytime soon and could potentially persist for decades.

The global EUV lithography supplier ASML stands out as the world’s largest and most advanced EUV company, as both TSMC and Samsung utilize EUV equipment for manufacturing, covering TSMC’s 7nm, 5nm, and 3nm processes and Samsung’s EUV Line (7nm, 5nm, and 4nm), along with the 3nm GAA process.

Wennink further emphasized that ASML has been operating in China for over 30 years, serving numerous customers and employing a large workforce locally. Therefore, the company feels obligated to protect the rights and interests of its customers and employees.

He acknowledged striving to maintain a balance between the US and China during his tenure, advocating on one hand for the US government to relax export restrictions and on the other hand raising concerns with Chinese officials about intellectual property infringements.

According to the reports, Wennink brought up the concerns from the U.S. authority about which party he sided with. Wennink noted that officials in Washington might sometimes think he’s friend of China. However, he is a friend to ASML’s customers, suppliers,  employees and shareholders. He then forecasted that given geopolitical interests are at stake, the chip war could take decades to play out.

Before retiring in April this year, Peter Wennink led ASML for a decade, transforming it into Europe’s largest semiconductor equipment manufacturer. During his tenure, China’s semiconductor influence rapidly grew, becoming ASML’s second-largest customer outside of Taiwan.

Since imposing export restrictions on China in 2018, the US has gradually expanded the list of controlled product categories, thus impacting ASML. In April this year, the US announced the latest round of export restrictions, limiting ASML’s ability to service high-end products already shipped to China.

At the time, Wennink emphasized that these new restrictions would not significantly impact ASML’s financial performance from 2025 to 2030, as only a small portion of its Chinese customers would be affected

Besides Netherlands, a previous report from Reuters on June 19 also mentioned that Japan, home to several chip equipment manufacturers like Nikon and Tokyo Electron, imposed restrictions on the export of 23 types of machinery to China to align with U.S. government policies aimed at curbing China’s technological advancements.

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• [News] US to Lobby Netherlands and Japan to Contain China’s Chip Development, Focusing on HBM
• [News] Strengthening Controls on Semiconductor Equipment Exports to China, Japan Reportedly Tightens Export Control Measures Further

(Photo credit: iStock)

According to a report from the Economic Daily News, amid the escalating US-China tech war, Chinese President Xi Jinping emphasized the need to enhance the sense of urgency and intensify efforts in technological innovation. Particularly in six key areas, including semiconductors, industrial machinery, and advanced materials, China aims to ensure the independence, security, and control of crucial industrial and supply chains, striving to become a technological powerhouse by 2035.

During the speech Xi delivered while presenting China’s top sci-tech award on June 24th, he stated that building China into a technological powerhouse has been a persistent goal of the Chinese nation since modern times. As per the same report, by 2035, China aims to possess world-leading technological strength and innovation capability, which will support a significant leap in economic strength, national defense strength, and comprehensive national power.

Xi also called for China to focus on six key areas, including addressing bottlenecks in integrated circuits (semiconductors), industrial machinery, basic software, advanced materials, and scientific research instruments by intensifying technological research and development efforts. The goal is to ensure that critical industrial and supply chains are self-sufficient, secure, and controllable, providing technological support for these areas.

Furthermore, he urged targeting the strategic high ground of future technological and industrial development, accelerating innovation in next-generation information technology, artificial intelligence (AI), quantum technology, biotechnology, new energy, and new materials. The aim is to foster the growth of emerging and future industries.

Regarding the current international situation, Xi mentioned that the technological revolution and major power rivalries are intertwined, making high-tech fields the forefront and main battleground of international competition. He also acknowledged that China’s capability for original innovation remains relatively weak, with some critical core technologies dependent on others and a shortage of top scientific talent.

Earlier this month, Huawei also reportedly acknowledged that China’s semiconductor development may have plateaued. Per a report from Business Korea, Zhang Ping’an, the Chief Executive Officer of Huawei Cloud Services, noted that manufacturing 3.5 nm semiconductors necessitates EUV lithography machines, which Huawei is reportedly working on independently. However, overcoming U.S. and Dutch patents to internalize this technology is considered highly challenging.

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• [News] US to Lobby Netherlands and Japan to Contain China’s Chip Development, Focusing on HBM
• [News] Huawei Reportedly Acknowledges China’s Semiconductor Development May Have Plateaued, Facing Challenges Below 3.5nm

(Photo credit: iStock)