The US-China tech rivalry has pushed China to focus on self-reliance, with a hybrid strategy balancing security-driven self-sufficiency and market-driven global integration. This approach may shape the future of China's semiconductor industry and its position in the global market ¹.

China's progress in microchips can be attributed to its strategic development strategy, government support, and innovation. Key players like Huawei and Xiaomi have driven this growth through massive investment and research. Here's what's contributing to China's semiconductor success:

- *Government Support*

- Billions of yuan invested in research, training, and local chip manufacturing

- Creation of research institutes and funding for local foundries like SMIC

- *Innovation and Development*

- Huawei's in-house Kirin 9000S processor, produced locally by SMIC

- Xiaomi's development of own semiconductors for cameras and energy management

- Adoption of alternative architectures like RISC-V, reducing dependence on Western technologies

- *Industry Progress*

- High self-sufficiency in areas like photoresist stripping, cleaning, etching, and chemical mechanical planarization

- Growing capabilities in memory and AI chip design

- Domestic chip production expected to reach 50% self-sufficiency by 2025

Despite these advancements, China still faces challenges, including:

- *Dependence on Foreign Technology*: reliance on imports, particularly for advanced equipment and materials

- *Talent Gaps*: shortages in specialized skills and expertise

- *Geopolitical Tensions*: trade restrictions and export controls limiting access to cutting-edge technologies

The US-China tech rivalry has pushed China to focus on self-reliance, with a hybrid strategy balancing security-driven self-sufficiency and market-driven global integration. This approach may shape the future of China's semiconductor industry and its position in the global market ¹.