Huawei, Receiving 40 Trillion KRW in Chinese Government Support, Building a 'Secret Factory'

Measures to Evade US Sanctions on Semiconductors
Chinese Government Subsidies Comparable in Scale to US

Chinese IT company 'Huawei,' which is on the U.S. government's blacklist, is reportedly secretly building semiconductor manufacturing facilities with subsidies from the Chinese government.

On the 23rd (local time), U.S. news agency Bloomberg cited claims from the Semiconductor Industry Association (SIA) that "Huawei has been attempting to produce its own semiconductors since last year."

The SIA alleges that Huawei is receiving approximately $30 billion (about 40 trillion KRW) in subsidies from the Chinese government and the city of Shenzhen. This is part of a so-called "shadow manufacturing network" aimed at achieving semiconductor self-sufficiency by circumventing U.S. export restrictions on advanced technology equipment.

Huawei Photo by Reuters Yonhap News

According to the SIA, Huawei recently acquired two semiconductor factories and is constructing three new ones. The amount of subsidies Huawei has received from the government is comparable to the budget of the Semiconductor Support Act passed earlier by the U.S. administration.

Additionally, the SIA estimates that China plans to invest about $100 billion (approximately 132 trillion KRW) by 2030 to establish 23 semiconductor fabs. As a result, China is expected to account for more than half of the global production of 28?45 nm semiconductors by that year.

Previously, the U.S. Department of Commerce placed Huawei on the blacklist in 2019. Consequently, Huawei has been unable to cooperate with U.S. companies in nearly all advanced IT industries.

However, Huawei has sought workarounds by purchasing semiconductor manufacturing facilities or chips under the names of third-party companies. It is reported that through these methods, Huawei has also acquired a significant amount of U.S.-made semiconductors and advanced manufacturing equipment.

Regarding the SIA's claims, the U.S. Department of Commerce's Bureau of Industry and Security (BIS) stated in a press release, "Considering the strict restrictions imposed on Huawei, Fujian Jinhua, PXW, and others, it is not surprising that they sought state support to attempt technology development," adding, "BIS continuously reviews export controls and, as indicated in the regulations issued on October 7 last year, will not hesitate to take appropriate measures to protect U.S. national security."

At that time, the U.S. administration implemented export control measures restricting support by U.S. companies and individuals for the development and production of certain semiconductor manufacturing facilities in China. The scope of "certain semiconductors" was also specifically explained. Logic semiconductors of 16/14 nm or below, NAND with 128 layers or more, and DRAM are all subject to controls for processes of 18 nm or below.

This content was produced with the assistance of AI translation services.