Since the US allowed NVIDIA to sell its H200 chip to China, there have been two reactions. On the one hand there are the Chinese companies, such as Alibaba or Bytedancewho want to get hold of them as soon as possible. On the other hand, the reluctance of the Chinese government whose main objective is to stop depending on the US. Now they have taken another step in that direction.
what has happened. According to one Reuters exclusivethe Chinese government has imposed a new rule on semiconductor manufacturers that want to expand their production capacity: they must do so using at least 50% equipment manufactured in China.
It is not a public standard that is included in an official document, but they say from Reuters that manufacturers that have recently expanded their factories have found themselves required to demonstrate that half of their equipment was ‘made in China’. If they do not comply, it is normal that they will be denied.
Why is it important. It is further proof of Beijing’s determination to prioritize national chips, but it goes even further by requiring that the necessary machinery also be national. In this way it impacts the entire supply chain, not just the chips. The striking thing is by making the minimum 50% it is causing manufacturers to have to prioritize Chinese technology even in areas where they could be done with foreign technology. The goal is clear: total self-sufficiency.
The winners. Before the ban, Chinese chipmakers like SMIC typically used American equipment and Chinese manufacturers were their last option. Now they have no choice but to turn to companies like Naura Technology and AMEC, whose demand for lithography machinery has increased exponentially and with it its income. Furthermore, this demand has caused them to improve their technology more quickly, something that is reflected in the registration of patents. In 2025 Naura registered 779 patents, more than double that of several previous years.
Self-sufficiency. The biggest challenge is in semiconductors; Without access to the most advanced lithography machines, Chinese chips are several years behind the most advanced ones made by companies like ASML or TSMC. In parallel to all these policies to prioritize national chips, China is promoting projects to ‘hack’ that technology and be able to place themselves at the same level.
At the level of AI chips, they are also promoting companies that They seek to be ‘the Chinese NVIDIA’ like MetaX or Moore Threads. They still have a long way to go, but it is no longer a question of if, but when.
Image | Nick Woodedited
In Xataka | Huawei and SMIC find the key to creating 7nm chips: do an ‘Ikea hack’ to the oldest ASML machines
GIPHY App Key not set. Please check settings