Huawei Technologies Co. and Semiconductor Manufacturing International Corp., already blacklisted by the U.S., launched a new phone using highly advanced technology that has sparked concern in Washington. To help you understand what is going on in the trade/China landscape and what we expect may happen in the future, our highly experienced Kiplinger Letter team will keep you abreast of the latest developments and forecasts (Get a free issue of The Kiplinger Letter or subscribe). You'll get all the latest news first by subscribing, but we will publish many (but not all) of the forecasts a few days afterward online. Here’s the latest…
China’s big chip breakthrough is less than meets the eye. Recent news, that telecom giant Huawei collaborated with China’s largest chipmaker, Semiconductor Manufacturing International Corporation (SMIC) on an advanced processor to power its latest smartphone, set off alarm bells in Washington.
But the chip they produced is still five years behind the cutting edge — an eternity in semiconductor time. And without access to more advanced equipment, which is limited by export controls, Beijing will struggle to produce additional breakthroughs, despite heavily subsidizing various semiconductor manufacturing initiatives.
Sign up for Kiplinger’s Free E-Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
Nevertheless, don’t be surprised if Uncle Sam further tightens restrictions on China’s access to semiconductor manufacturing equipment. By some accounts, U.S. enforcement of export controls has been less stringent than expected, a consequence of industry lobbying.
But critics also say these regulations were poorly designed, allowing China to access less-advanced equipment still capable of making more advanced chips, though not well enough to be commercially viable.
This forecast first appeared in The Kiplinger Letter, which has been running since 1923 and is a collection of concise weekly forecasts on business and economic trends, as well as what to expect from Washington, to help you understand what’s coming up to make the most of your investments and your money. Subscribe to The Kiplinger Letter.
Related Content
-
-
Stock Market Today: Dow Soars 511 Points After McDonald's Earnings
All three indexes notched impressive gains Monday ahead of a jam-packed week on Wall Street.
-
T-Mobile Walks Back Plan to Switch Users to Pricier Plans
Immediate customer backlash led T-Mobile to change course on planned price increases.
-
President Biden Builds the Wall: The Kiplinger Letter
The Kiplinger Letter Democrats are divided on how to handle illegal border crossings, but roughly 65% of voters, on average, disapprove of Biden's handling of the issue.
-
Tech Giants Look to Curb AI's Energy Demands: The Kiplinger Letter
The Kiplinger Letter The expansion in AI is pushing tech giants to explore new ways to reduce energy use, while also providing energy transparency.
-
New Employment Guidance Proposed on Hostile Work Practices: The Kiplinger Letter
The Kiplinger Letter New guidelines for employers fueled by a sharp increase in employment discrimination lawsuits in 2023.
-
SEC Cracks Down on Misleading Fund Names: The Kiplinger Letter
The Kiplinger Letter The SEC rules aim to crack down on so-called “greenwashing” — misleading or deceptive claims by funds that use ESG factors.
-
As Tensions Rise, U.S. Imports From China Shrink: The Kiplinger Letter
The Kiplinger Letter China now accounts for less than 13.5% of American imports from abroad.
-
Senate Moderates May Soon Be an Endangered Species: The Letter
The Kiplinger Letter Senate centrists on both sides of the aisle feel the growing tensions in Washington.
-
Traffic Circles Can Make Intersections Safer, But Also Confusing: The Kiplinger Letter
The Kiplinger Letter In the U.S. traffic circles are on the rise — studies show that roundabouts, as they are commonly known, are safer than traditional intersections.
-
Cargo Thefts on the Rise: The Kiplinger Letter
The Kiplinger Letter Organized crime rings are targeting goods in shipments.
