China pledged to boost spending and drive research into cutting-edge chips and artificial intelligence (AI) in its latest five-year targets, laying out a technological blueprint to vie for global influence with the US.
Chinese Premier Li Keqiang (李克強) singled out key areas in which to achieve “major breakthroughs in core technologies,” including high-end semiconductors, operating systems, computer processors and cloud computing — areas in which US firms now hold sway.
Beijing would also aim to get 56 percent of the country on faster 5G networks.
Photo: EPA-EFE
Nationwide research and development spending is to increase by more than 7 percent annually, which “is expected to account for a higher percentage of GDP” than during the previous five years, Li added.
China is quickly moving to cut its dependence on the West for crucial components such as computer chips, an issue that became more urgent after a global shortage of semiconductors worsened during the pandemic.
Beijing is also making big bets on emerging technologies from hydrogen vehicles to biotech, while looking to ensure that its own chipmakers can compete with the likes of Intel Corp and Taiwan Semiconductor Manufacturing Co (台積電). That encompasses a new emphasis on silicon design software and so-called third-generation chipmaking — two areas critical to Beijing’s drive to achieve technology self-sufficiency.
“Innovation remains at the heart of China’s modernization drive,” Li said in an address to the Chinese National People’s Congress in Beijing yesterday. “We will strengthen our science and technology to provide strategic support for China’s development.”
Li’s speech punctuated goals enumerated in China’s 14th five-year plan, also released yesterday, which prioritized advances in younger spheres, such as quantum computing, neural networks and DNA banks. The document enshrines a multi-layered strategy that is pragmatic and ambitious in scope, embracing aspirations to replace pivotal US suppliers and fend off Washington, while molding homegrown champions in emergent fields.
Chipmakers, including Shenzhen Goodix Technology Co (匯頂科技) and China Resources Microelectronics Ltd (崋潤微電子), rose more than 3 percent on Chinese bourses in the afternoon, but Hong Kong-listed Semiconductor Manufacturing International Corp (中芯), China’s largest chipmaker, slipped in tandem with a broader global selloff of tech shares.
At stake is nothing less than the future of the world’s No. 2 economy. Beijing is moving swiftly, while US President Joe Biden’s administration escalates a battle against what it called “techno-autocracies.” That could extend or even expand blacklistings that banned key transactions with corporations from Huawei Technologies Co (華為) to ByteDance Ltd (字節跳動) and Tencent Holdings Ltd (騰訊).
To a country that imports US$300 billion of chips annually, a worsening global shortage drives home the risk of relying on potentially hostile suppliers for the building blocks of everything from AI to next-generation networks and autonomous vehicles.
Yesterday’s report formalized China’s ambitions to develop its own software for semiconductor design — supplanting tools from US firms Cadence Design Systems Inc and Synopsys Inc.
It also pledged to develop its own advanced chip manufacturing technologies and key materials that comprise third-generation chips. The country aims to secure first-mover advantage in that nascent arena involving compounds such as silicon carbide and gallium nitride, as well as chips that can operate at high frequency, and in higher-power and higher-temperature environments, with broad applications in 5G radio frequency chips, military-grade radar and electric vehicles.
While specifics of that endeavor are not to emerge for months, yesterday’s documents provided important clues about the envisioned roadmap. That includes building more national laboratories and innovation centers, as well as ramping up efforts to implement a little-heard of program called the Sci-Tech Innovation 2030 Agenda.
Beijing also revealed plans to try and entice more talent from abroad via a “technology immigration system,” likely targeting semiconductor hotbeds from Silicon Valley to Taiwan.
The US dollar was trading at NT$29.7 at 10am today on the Taipei Foreign Exchange, as the New Taiwan dollar gained NT$1.364 from the previous close last week. The NT dollar continued to rise today, after surging 3.07 percent on Friday. After opening at NT$30.91, the NT dollar gained more than NT$1 in just 15 minutes, briefly passing the NT$30 mark. Before the US Department of the Treasury's semi-annual currency report came out, expectations that the NT dollar would keep rising were already building. The NT dollar on Friday closed at NT$31.064, up by NT$0.953 — a 3.07 percent single-day gain. Today,
‘SHORT TERM’: The local currency would likely remain strong in the near term, driven by anticipated US trade pressure, capital inflows and expectations of a US Fed rate cut The US dollar is expected to fall below NT$30 in the near term, as traders anticipate increased pressure from Washington for Taiwan to allow the New Taiwan dollar to appreciate, Cathay United Bank (國泰世華銀行) chief economist Lin Chi-chao (林啟超) said. Following a sharp drop in the greenback against the NT dollar on Friday, Lin told the Central News Agency that the local currency is likely to remain strong in the short term, driven in part by market psychology surrounding anticipated US policy pressure. On Friday, the US dollar fell NT$0.953, or 3.07 percent, closing at NT$31.064 — its lowest level since Jan.
The New Taiwan dollar and Taiwanese stocks surged on signs that trade tensions between the world’s top two economies might start easing and as US tech earnings boosted the outlook of the nation’s semiconductor exports. The NT dollar strengthened as much as 3.8 percent versus the US dollar to 30.815, the biggest intraday gain since January 2011, closing at NT$31.064. The benchmark TAIEX jumped 2.73 percent to outperform the region’s equity gauges. Outlook for global trade improved after China said it is assessing possible trade talks with the US, providing a boost for the nation’s currency and shares. As the NT dollar
The Financial Supervisory Commission (FSC) yesterday met with some of the nation’s largest insurance companies as a skyrocketing New Taiwan dollar piles pressure on their hundreds of billions of dollars in US bond investments. The commission has asked some life insurance firms, among the biggest Asian holders of US debt, to discuss how the rapidly strengthening NT dollar has impacted their operations, people familiar with the matter said. The meeting took place as the NT dollar jumped as much as 5 percent yesterday, its biggest intraday gain in more than three decades. The local currency surged as exporters rushed to