Prime Highlights

• Hua Hong Group is preparing to start production of advanced 7-nanometre semiconductor chips, marking a major step in China’s push for technological self-reliance.
• The move comes as China strengthens its domestic semiconductor industry amid global technology restrictions.

Ket Facts

• Hua Hong Group is China’s second-largest chipmaker, specializing in semiconductor manufacturing and foundry services.
• The company is working to develop 7-nm chip production technology, which is used in advanced computing and artificial intelligence applications.

Background

China’s second-largest chipmaker, Hua Hong Group, said it plans to produce 7-nanometre semiconductor chips. This development represents a crucial advancement for Beijing’s efforts to achieve independence from foreign technology in the global semiconductor sector.

Huali Microelectronics, which operates as a contract manufacturing division of the company, has developed a 7-nanometer manufacturing process at its Shanghai Fab 6 facility, according to sources. The successful development of this technology will enable Hua Hong to become the second Chinese company which can manufacture advanced chips after Semiconductor Manufacturing International Corp., the country’s largest foundry.

The Chinese government is increasing its efforts to build a complete domestic semiconductor supply chain because the United States and its partner countries continue to impose technology limitations. The 7-nm technology production process produces advanced chips that manufacturers create as fundamental parts of high-performance computing systems and artificial intelligence systems.

According to sources, Hua Hong started its research and development activities on this technology during the previous year. The company plans to produce several thousand wafers each month at its initial production stage, which will begin by December, and later increase its manufacturing capacity. The development process required collaboration between Chinese technology firms and local equipment manufacturers because Beijing wants to promote the use of domestic technologies.

China’s government has been urging companies to adopt homegrown semiconductor solutions even after the United States has partially eased its export restrictions, which now permit limited AI chip sales to certain countries.

Hua Hong’s technological progress demonstrates China’s commitment to developing domestic semiconductor manufacturing while reducing its dependence on international semiconductor technology, according to analysts. The company needs to improve its production efficiency through the acquisition of required advanced manufacturing technology, which will enable it to compete with international semiconductor industry leaders.

If the project is successful, it may allow China to advance to a degree of greater self-sufficiency in a critical sector of semiconductor manufacturing.