Money alone is not enough for China to get rid of US restrictions in the chip sector

The Chinese government has spent more than $140 billion in support for the semiconductor manufacturing sector, which includes subsidies to buy domestically-manufactured chip-making equipment.

This payment is made in response to the US tightening restrictions on chip manufacturing technology because of concerns that China will use these technologies to make chips for artificial intelligence applications. in military.

But money alone is not enough for the country’s chip manufacturing sector to catch up with Western rivals many generations ahead.

The reason is because Shanghai Microelectronics Corporation (SMEE) – the country’s only lithography enterprise and its peers mainly sell products to domestic chip foundries. In addition, the lack of exposure to advanced chip manufacturing facilities such as Taiwan Semiconductor Manufacturing Co., Ltd (TSMC) and South Korea’s Samsung Electronics Co., Ltd. has made it difficult for these businesses to operate. solving technical problems, causing many barriers in the research of new products. At the same time, it also restricts the country from learning the tricks of the trade.

Too hard to solve

According to people who used to work at SMEE, in 2002, when the company was first established, because there was no experience in lithography, the senior management at SMEE and his employees built the first machines thanks to acquisition of old equipment for research and by reading patents and public papers.

The company later became advanced enough to produce a machine that could print circuit patterns as small as 90 nanometers (nm) on silicon wafers.

While the technique is two decades behind Dutch lithography giant ASML Holding (ASML), it is still hailed as a breakthrough in the country and in 2018 won a local government award.

But since then, SMEE hasn’t made any major progress, partly due to the difficulty of procuring equipment from abroad. “ Even if we can build the machines, we don’t know how to maintain them ,” said one SMEE engineer.

In addition, another former top employee at a Chinese chip equipment manufacturing company recounted that, in the process of working to master the technique of 3D NAND Flash engraving, they were unable to perfect one element. The important factor is to ensure the hole size of the chip. “ We knew what it took to do that, but we were limited by the design capabilities of the device. Our US adversary has solved that, ” said the employee.

Need to find a new direction

Some in the industry have called for China to focus on the future era of chip manufacturing instead of trying to compete abroad in creating increasingly denser circuits on chips.

At the end of February 2023, two senior scholars from the Chinese Academy of Sciences published a paper advocating focusing on research and development of new technologies and materials, rather than emulating existing technology from foreign.

According to the two scholars, Beijing needs to accumulate a portfolio of patents that govern the next generation of chip production, from new materials to new techniques, on the basis of the strengths of materials and innovative capabilities of manufacturers. young science.

In-depth research into breakthrough materials, components and manufacturing will help China’s chip companies build a patent portfolio that includes critical key technologies, pages essential equipment and techniques that the United States is currently using as a weapon against China.

As the situation could get worse for Chinese companies if Japan and the Netherlands agree with the US to also restrict exports of chip-making equipment to China.