US goes even further to prevent a 5nm successor to Huawei’s Kirin 9000s

Reuters reported that the Biden administration has intensified restrictions on China’s top sanctioned chipmaker, SMIC, following revelations that its most advanced factory, SMIC South, produced a sophisticated chip for Huawei’s Mate 60 series devices.

China manages to fabricate chips despite several trade restrictions intended to prevent the same

The trade sanctions aim to curb the flow of U.S. technology to SMIC and undermine its ability to manufacture advanced chips for Huawei or any other Chinese manufacturer. The Huawei Mate 60 series, powered by the 7nm Kirin 9000 series chip, symbolized China’s technological resurgence despite ongoing efforts by the U.S. to impede its semiconductor capabilities.

There are also reports that Huawei is working on a 5nm chip amidst all the sanctions. As PhoneArena noted, this new Kirin chip could result in a significant leap for Huawei phones in 2024. It reportedly gets closer to Apple’s 3nm A17 Pro. Although, there’s no concrete evidence of the development at this point. Nonetheless, US officials are definitely feeling the need to impose even stricter restrictions on the US suppliers of chip-building equipment in order to prevent a successor to China’s Kirin 9000 chips.

A response to Huawei’s development of Kirin chips

Late last year, the US Department of Commerce sent letters to US suppliers to SMIC, preventing them from supplying chip manufacturing equipment to SMIC’s most advanced plant, SMIC South. Notably, it was reported that SMIC South is the only chip manufacturing plant in China capable of fabricating cutting-edge chips that can meet the requirements of Huawei’s flagship devices. The said letters to US suppliers effectively cut off millions of dollars worth of shipments of chipmaking materials to the said plant, reported Reuters.

The trajectory of restrictions on SMIC and Huawei has been gradual but consequential. Both companies were added to trade restrictions lists in 2019 and 2020, respectively, over alleged violations and ties to China’s military complex. However, the Trump administration allowed shipments to them under certain conditions. In October 2022, the Biden administration implemented new rules banning U.S. suppliers from sending semiconductor tools and materials to advanced Chinese-run chipmaking factories, including SMIC South.

While Entegris, a Massachusetts-based company maintains it complied with valid export licenses, it ceased shipments after receiving letters from the Commerce Department. The Biden administration’s actions signify a concerted effort to restrict SMIC’s access to advanced U.S. technology, a move criticized by the Chinese embassy in Washington as “economic bullying.”

The impact of these restrictions extends beyond SMIC’s operations, affecting its supply chain and potentially disrupting production for several months. As Lita Shon-Roy, CEO of market research firm Techcet said, “It would take time to find and conduct rigorous testing of new suppliers unless SMIC South had done so in advance.”