China's Chip Self-Sufficiency in One Chart
[Opinion] It's true that the nation has become more adept at making gear which is used to make chips. But this chart puts that development in context
Good Morning from Taipei,
China’s semiconductor self-sufficiency is vastly overstated and misunderstood. But still, there’s lots of opinions about an imminent chipocalypse based largely on reports that go unquestioned.
A persistent belief is that US curbs sparked Beijing to push for an indigenous semiconductor industry. That’s pure rubbish. A detailed and fascinating report published recently by Gregory C. Allen for the Center for Strategic and International Studies (CSIS) picks off a lot of the myths about development and progress.
As Allen points out, “The Roadmap of Major Technical Domains for Made in China 2025” was published in 2015, before Trump even took power for the first time. I’ve personally been tracking Beijing’s ambitions since it joined the WTO in 2001 when Washington wasn’t even aware that China had such a goal.
China has been trying for a long time, and one area where self-sufficiency can be assessed is in supply and demand for manufacturing equipment. A particular section of Allen’s report caught my eye. He looks at the shift in Chinese output of chip-making gear over the past 15 years against its demand for such equipment.
Allen presented it in a table (below), but the data was very enlightening. That’s why I put it in a graphical form — with his permission.
The takeaway is pretty simple: China has indeed spun up its chipmaking-equipment sector, but a look at the gap against actual demand shows how far the nation is from achieving self-sufficiency.
I thought this was interesting and thought I’d share.
Thanks for reading.
Some More Charts to Feast on:
They are growing very fast.