👀 Ones to watch: Undervalued stocks to buy before they report Q3 earningsSee Undervalued Stocks

World going through unprecedented chip shortage, China trade body says

Published 03/17/2021, 05:40 AM
Updated 03/17/2021, 06:26 AM
© Reuters. FILE PHOTO: A researcher plants a semiconductor on an interface board during a research work to design and develop a semiconductor product at Tsinghua Unigroup research centre in Beijing

By Josh Horwitz

SHANGHAI (Reuters) - The world is going through an unprecedented chip shortage, Zhou Zixue, a senior official with the China Semiconductor Industry Association, said on Wednesday, after semiconductor sales grew 18% last year.

"If you are an experienced player, you will remember that in 1999 there was a similar crisis in this industry, but it was way smaller," Zhou, chairman of Semiconductor Manufacturing International Corp (SMIC), said in remarks at SEMICON China.

"We have to deepen our cooperation, we have to give more attention to innovation. Only by doing that our industry can control the challenges facing us."

China is the world's largest buyer of semiconductors, but domestic production is marginal. Sales in China grew 17.8% in 2020 from a year earlier to 891 billion yuan ($137 billion), according to CSIA.

China's need to cut dependence on overseas chip companies became evident last year when U.S. sanctions on Shenzhen-based hardware maker Huawei Technologies Co Ltd prevented it from sourcing components, crippling a once-booming smartphone business.

Not long after that, the spread of COVID-19 disrupted supply chains and eventually caused a chip shortage. Once concentrated in the automotive industry, the crunch has now spread to a wide range of electronics and reached the uppermost parts of the chip supply chain.

© Reuters. Semicon China trade fair for semiconductor technology, in Shanghai

($1=6.5 yuan)

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.