Chinese semiconductor designers and companies are reportedly engaging with Malaysian firms to help them assemble a part of their high-end chips in country. The move clearly reflects the fear of further US sanctions on China’s chip industry, as they seek to hedge and mitigate the risks from said sanctions.
According to source close to Reuters, the Malaysia chip companies in question are known for their expertise in assembling Graphics Processing Units (GPUs). As to how the Chinese semiconductor companies are able to pass through the US security nets – the current set of US sanctions prohibits the fabrication and designing of chip wafers, but not their assembly. At the time of writing, some agreements have already been concluded but those companies have requested that their identity be kept secret, citing confidentiality agreements.
For the uninitiated, the US has been slapping China with sanctions on chip-making and chip-producing capabilities for semiconductors, mainly due to fears of the latter advancing its military capabilities, especially in the field of AI and supercomputing.
It’s no secret as to why Chinese semiconductor firms would engage the services of Malaysia chip assembly firms too. The country currently accounts for 13% of the global market for semiconductor packaging, assembly, and testing, and the industry is aiming to boost that number to 15% by 2030. On that note, Chinese chip firms such as Xfusion and StarFive have already expanded their operations into the country, with factories set to be built in specific states such as Penang, which is also where Intel’s factories are located.
(Source: Reuters)
