Vertical Divider
China’s Next 5-Year Plan to Emphasize Domestic Development of Semiconductors for Computers and Smartphones
Chinese leaders met last week to formulate an economic blueprint for the next five years that is expected to emphasize development of semiconductors and other technology at a time when Washington is cutting off access to U.S. technology. The Five-Year Plan, the 14th in a series issued since the 1950s, is the foundation for government industrial plans in the heavily regulated economy. Its broad outlines were announced on Thursday but the full plan won't be released until March. “Achieving independence in key areas, such as scientific research and finance, is expected to be a focus.” The latest plan is expected to emphasize domestic development of semiconductors for computers and smartphones — China's biggest single import by value — next-generation telecoms, artificial intelligence and other fields. The ruling party has promoted semiconductor development for two decades but Chinese makers of smartphones and other products still rely on the U.S., Europe and Japan for processor chips. Beijing feels increased pressure after the Trump administration cut off access to most American supplies for Huawei Technologies Ltd., a global maker of smartphones and switching equipment, in a feud over technology and security. Beijing's plan is to emphasize “lower reliance on foreign suppliers for strategic products such as food, energy, semiconductor and other key technologies,” Hu and Ji wrote. The push for self-sufficiency might hamper economic growth by diverting resources away from more productive uses, Julian Evans-Pritchard and Sheana Yue of Capital Economics said in a report. “Pursuing self-sufficiency may still be rational as a form of insurance against aggressive decoupling by the U.S. and its allies, but China’s economy would be better off if such insurance weren’t needed in the first place."
Chinese leaders met last week to formulate an economic blueprint for the next five years that is expected to emphasize development of semiconductors and other technology at a time when Washington is cutting off access to U.S. technology. The Five-Year Plan, the 14th in a series issued since the 1950s, is the foundation for government industrial plans in the heavily regulated economy. Its broad outlines were announced on Thursday but the full plan won't be released until March. “Achieving independence in key areas, such as scientific research and finance, is expected to be a focus.” The latest plan is expected to emphasize domestic development of semiconductors for computers and smartphones — China's biggest single import by value — next-generation telecoms, artificial intelligence and other fields. The ruling party has promoted semiconductor development for two decades but Chinese makers of smartphones and other products still rely on the U.S., Europe and Japan for processor chips. Beijing feels increased pressure after the Trump administration cut off access to most American supplies for Huawei Technologies Ltd., a global maker of smartphones and switching equipment, in a feud over technology and security. Beijing's plan is to emphasize “lower reliance on foreign suppliers for strategic products such as food, energy, semiconductor and other key technologies,” Hu and Ji wrote. The push for self-sufficiency might hamper economic growth by diverting resources away from more productive uses, Julian Evans-Pritchard and Sheana Yue of Capital Economics said in a report. “Pursuing self-sufficiency may still be rational as a form of insurance against aggressive decoupling by the U.S. and its allies, but China’s economy would be better off if such insurance weren’t needed in the first place."
|
Contact Us
|
Barry Young
|