SMIC to Invest $7.5 Billion in Expansion Amidst US Sanction Concerns

The sophisticated and highly advanced chip foundry operator in mainland China, Semiconductor Manufacturing International Corp (SMIC), is investing $7.5 billion to build a new 12-inch wafer production line in the northern city of Tianjin as part of a capacity expansion program that has become more urgent due to worries about new US trade sanctions.

According to SMIC’s press release on Friday in Hong Kong and Shanghai, the new plant will be constructed inside the XEDA Sci-Tech Park, south of the city of Tianjin, in the Xiqing Development Area. It will have a monthly production capacity of 100,000 12-inch wafers, covering 28-nanometer and more advanced semiconductor manufacturing process nodes. There was no deadline given for this project.

SMIC’s new Tianjin project comes after the contract chip maker reportedly began producing 7-nanometer technology. According to TechInsights’ most recent research, SMIC has adopted several TSMC-deployed process integration options because “there are significant parallels in process technology, designs, and advancements between SMIC’s 7-nm and TSMC’s 7-nm.”

The architecture of SMIC’s 7nm Chip | TechInsights

The Chips and Science Act, which the White House signed into law to discourage TSMC, Samsung, Intel, and other companies from investing in advanced manufacturing, including 7-nm process technology or newer, in mainland China, will make it difficult for China to catch up in the chip industry. However, China’s SMIC is working out its way of finding an alternative to US sanctions by manufacturing its semiconductor technology. 

Technology is advancing quickly as the world’s economies compete with one another for dominance. Trade tensions between the US and China are allowing businesses like SMIC to control local markets through their own manufacturing. Considering the developments being made by both parties, it will be interesting to watch how things turn out.

Muhammad Zuhair
Passionate about technology and gaming content, Zuhair focuses on analysing information and then presenting it to the audience.
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