Russian Government Mulls Chinese Foundries, State Aid to Evade US Sanctions
upstart writes:
Russian Government Mulls Chinese Foundries, State Aid to Evade US Sanctions:
The Russian Federation government is considering adding chip designers Baikal Electronics and MCST to the list of 'backbone enterprises.' The status will provide Baikal and MSCT with numerous benefits, including subsidies. State aid might help these companies to transition the production of their chips from Taiwan to China. Meanwhile, it is unclear whether fabs like SMIC and Hua Hong are interested in making chips for Russian companies and risk additional sanctions.
"Such a move could also be aimed at transferring the production of Russian processors from the Taiwanese TSMC, which abandoned their production due to sanctions, to Chinese factories," a report by CNews reads.
Amid the global chip deficit, prominent Chinese foundries like SMIC and Hua Hong have landed large orders from existing and new clients. Officially, SMIC has been operating at over 100% capacity for several quarters now, so it is unclear whether it can even make chips for Baikal and MCST. Another question is whether those companies can legally produce those processors.
[...] While many media outlets highlight ASML, the world's largest supplier of lithography equipment, as the key maker of semiconductor production tools, there are a half-dozen U.S.-based companies (Applied Materials, KLA, Lam Research, etc.) that build fab equipment without which fabs cannot function. As a result, virtually all foundries in the world need to obtain an export license from the U.S. government if they want to make chips for companies like Huawei, Phytium, Sunway, or essentially all Russian chipmakers.
License applications to produce chips for the said companies are undertaken with a presumption of denial. So given the current attitude towards Russia, it is unlikely that SMIC and Hua Hong can actually help Russia to save its two major developers of CPUs. Furthermore, it is unclear from where Baikal could get contemporary Arm licenses as the U.K. has also imposed sanctions against the Russian high-tech industry.
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