To win the chip war, China needs a multinational strategy

China's chip exports nearly doubled in the first half of 2024, driven by mature logic integrated circuits, while Nvidia's H200 chips have resumed limited imports into China. The US leads in advanced AI chips, but China is emerging as a dominant player in legacy chips and closing the gap in CPUs, a segment long dominated by Intel and AMD. Memory chips remain controlled by South Korea's Samsung and SK Hynix, with China's ChangXin Memory Technologies holding an 8% market share ahead of its Shanghai IPO.

To win the chip war, China needs a multinational strategy Beyond GPU supremacy, America’s greatest asset lies in its leverage over its allies’ critical technologies and capacities Nvidia’s H200 chips https://www.scmp.com/news/china/diplomacy/article/3360582/us-says-nvidias-h200-exports-china-remain-trivial-despite-approvals?module=inline&pgtype=article , a step down from its most advanced Blackwell line, have resumed imports into China, albeit in small quantities. Meanwhile, China’s chip exports nearly doubled https://www.scmp.com/tech/article/3360503/global-ai-boom-sees-chinas-chip-exports-nearly-double-first-half-year?module=inline&pgtype=article in the first half of this year. Much of these exports are mature logic integrated circuits for applications in consumer electronics and automotive sectors. While the US is the undisputed leader in the most advanced artificial intelligence AI chips, China is emerging as a dominant player in mass market legacy integrated circuits. Between the two is the central processing unit CPU layer, the brains of laptops and servers. Before the AI era, Intel CPUs once symbolised American semiconductor leadership. As AI transitions from model training to applications, CPUs will regain importance in the next five years. Although the CPU segment has long been dominated by Intel and AMD, Chinese firms are closing the gap. It is a more contestable arena where China has a more realistic chance of becoming self-sufficient over time. Another key segment is memory chips, which the United States ceded to East Asia decades ago. Samsung Electronics and SK Hynix together account for two-thirds of the global dynamic random access memory DRAM market, while Japanese firms continue to have a critical role in the supply chain upstream. ChangXin Memory Technologies https://www.scmp.com/tech/article/3359955/chinas-top-dram-maker-sets-date-us43b-shanghai-ipo-amid-memory-boom?module=inline&pgtype=article , with an 8 per cent market share, is expected to make its debut in a Shanghai listing on July 27.