China’s Ascension in Semiconductor Technologies

• China’s semiconductor dominance now extends to the realm of memory chips, an area traditionally led by South Korean giants like Samsung and SK Hynix.
• In spite of stringent US export tariffs, China has risen to become the second-largest player globally in memory technologies.

China’s growing prowess in the semiconductor industry is becoming increasingly evident across critical technology sectors. A recent report released by the Korea Institute of Science and Technology Evaluation and Planning (KISTEP) further illustrates this notable shift.

The findings from this South Korean think tank indicate that China has now surpassed South Korea in foundational capabilities across a wide array of semiconductor technology domains. This is particularly significant in the memory sector, where South Korean companies have enjoyed a stronghold for decades, showcasing their historical leadership in innovation and production.

KISTEP Findings: A New Era in Semiconductor Landscape

The insights presented in the KISTEP report are derived from an extensive survey featuring 39 South Korean semiconductor experts conducted in 2024. The report highlights a dramatic evolution in the global semiconductor hierarchy. It reveals that China currently ranks ahead of South Korea in memory chip technologies, marking a pivotal change for South Korean firms such as Samsung Electronics and SK Hynix, which have long dominated this market.

With this new ranking, China now occupies the second position globally, only trailing behind the United States in memory advancements. This transformation starkly contrasts with the previous KISTEP findings from 2022, where South Korea held the second position while China occupied third and fourth spots in memory and advanced packaging technology sectors, respectively.

“Even within the memory market, where Korea had maintained its unrivaled status, Chinese semiconductor companies are progressively capturing greater market share,” the latest KISTEP report asserts. It also notes that Chinese firms are effectively ramping up the production of legacy chips, showing a “relatively narrow technology gap” compared to the worldwide industry leaders.

Assessing China’s Semiconductor Dominance: Technology Metrics and Capabilities

The comprehensive evaluation conducted last year reveals impressive scores for China in high-density resistive memory technology, achieving a ranking of 94.1% compared to South Korea’s 90.9%. This statistic is noteworthy, especially given that memory technology has historically been the backbone of South Korea’s semiconductor industry.

Additionally, the report illustrates China’s advancements in various semiconductor fields. In the realms of high-performance and low-power AI semiconductor technology, China scored 88.3%, surpassing South Korea’s 84.1%. In power semiconductor technology, China recorded a score of 79.8%, significantly outpacing South Korea’s 67.5%. Moreover, in next-generation high-performance sensing technology, China achieved a score of 83.9% compared to South Korea’s 81.3%.

Interestingly, both nations reached parity only in the domain of advanced packaging technology, with each meriting a score of 74.2% for foundational capabilities. Notably, while Taiwan excels in the commercialisation of advanced packaging technology, the US remains the front-runner in all other semiconductor sectors concerning foundational capabilities and commercialisation perspectives.

The KISTEP report also meticulously evaluates the technological lifecycle across the semiconductor industry. While South Korea still holds a lead in process and mass production, China is showing superiority in foundational capabilities and design. The report identifies South Korea’s foundational capabilities and design technology as weak points in its semiconductor lifecycle, giving it the lowest ranks among the countries evaluated.

Chinese memory producers have been diligently working to close the technological gaps that separate them from global industry leaders. Companies like ChangXin Memory Technologies (CXMT) have made remarkable progress, developing consumer-grade chips that utilize 16-nanometer processing technology.

While CXMT is still behind industry leaders such as Samsung, SK Hynix, and US-based Micron Technology, which operate at the 12-nm and 14-nm nodes for DDR5 memory production, their advancements signal a critical narrowing of the technological divide. China’s trajectory towards greater semiconductor dominance continues unabated, even in the face of widespread US export restrictions aimed at limiting China’s access to advanced chips and chip-making technologies. In light of these challenges, Beijing has adopted what analysts refer to as a “whole nation” strategy to achieve semiconductor self-sufficiency, initiating the country’s largest chip investment fund to date just last year.

Challenges and Opportunities in the Global Chip Race

The findings outlined in the KISTEP report underscore alarming concerns regarding the impacts of escalating geopolitical tensions on South Korea’s semiconductor industry. Among these concerns are risks related to potential declines in Korea’s exports or possible exclusion from the lucrative Chinese market due to stringent US export controls. Further challenges facing South Korea encompass the departure of essential talent from the semiconductor sector, intensifying competition within the AI semiconductor sphere, domestic policy constraints, and rapid shifts in global supply chains.

This situation presents significant issues for South Korea, a nation that has long built its economic success on its supremacy in the semiconductor market. For South Korea to preserve its esteemed position in this industry, it must urgently address its identified shortcomings in foundational capabilities and design technology.

While Taiwan continues to hold leadership in the commercialisation of advanced packaging technology, the United States remains dominant in overall semiconductor technology across both foundational capabilities and commercialisation aspects. Despite the stringent export bans and other international restrictions, China’s swift progress demonstrates the remarkable effectiveness of its focused strategy to attain technological self-reliance.

As China’s domestic semiconductor sector continues to evolve, particularly in essential memory technologies that have historically lagged behind, the global semiconductor landscape is undergoing a substantial and intricate realignment. The rapid emergence of China as a powerhouse in semiconductor foundational capabilities indicates that, despite the prevailing export controls and other regulatory challenges, notable progress is being achieved in its pursuit of technological imperatives.

How AI legalese decoder Can Facilitate Understanding and Navigation of the Semiconductor Landscape

In navigating this complex and evolving semiconductor landscape, stakeholders, including companies, policymakers, and investors, may find themselves faced with intricate regulations and legal jargon that can obscure the implications of the geopolitical and technological shifts occurring. This is where AI legalese decoder can play a pivotal role.

The AI legalese decoder is designed to simplify and clarify legal documents and complicated terminologies associated with regulations, agreements, and compliance issues in the semiconductor industry. By breaking down legal language into more understandable and accessible terms, it empowers users to make more informed decisions regarding their strategies and responses to the changing market dynamics.

For instance, companies facing export restrictions or considering investments in semiconductor technologies can utilize AI legalese decoder to gain insights into legal obligations, compliance requirements, and potential risks associated with different jurisdictions. More so, this tool can assist in understanding the implications of government policies and international relations that impact the semiconductor supply chain.

Thus, as China’s semiconductor industry escalates its advancements, stakeholders can leverage the insights provided by AI legalese decoder. By doing so, they can effectively navigate the complex legal landscape, enhancing their ability to respond to challenges and seize opportunities in this competitive market.