CMIIT Holds Talks With Chip Firms After US Sanctions

China’s Ministry of Industry and Information Technology (CMIIT) was reported to have held emergency talks over the previous week with major semiconductor firms to assess the impact of the US’s latest sanctions on purchases and sales of high-end chips from the country.

The tech overseer has invited executives of companies, including Yangtze Memory Technologies Co. (YMTC) Ltd. and supercomputer maker Dawning Information Industry Co. Ltd., to urgent closed-door discussions, according to the report.

US Sanctions, A Challenge for China’s Chip Industry

US President Joe Biden’s administration announced this month sweeping export restrictions prohibiting firms from exporting advanced semiconductors to China as part of its efforts to limit Beijing’s technological and military developments.

Experts expect the new curbs to have a significant impact, reducing China’s pace in establishing its chip industry and commercial and research on military weapons, artificial intelligence (AI), data centers, and other areas where supercomputers and advanced chips are needed.

The report stated that many attendees of the ministry’s meetings said the US’s new rules present a gloomy future for their businesses and China’s plans to separate its economy from US technology.

CMIIT, YMTC, and Dawning have yet to comment on the matter.

Chinese President Xi Jinping has called for his country to prevail in the fight for core technologies in his work report, as he starts the Communist Party Congress, which occurs every five years.

The work report may hint at an overhaul in China’s strategy to further improve its tech industry, with additional state-led spending and intervention to offset US pressures.

Xi has also said they would create technological self-reliance and strength through a better education system and foreign experts.

Beijing had tightened control over private sector leaders, including e-commerce giant Alibaba Group Holding Ltd., by introducing crackdowns, such as anti-monopoly and data security.

Facing political pressure, these companies have been putting billions of dollars into chip production and other initiatives.