China slashes import tax to boost semiconductor sector
In this article (5)
China announced new import cuts this week to boost the nation’s semiconductor industry. This follows after US sanctions on some Chinese companies including tech giant Huawei and chipmaker SMIC to ease the impact on the industry.
According to China’s finance ministry, chipmakers producing high-end 65-nanometer technology or smaller chips can import raw materials and machinery tax-free through 2030.
Totaling more than $300 billion annually, China’s processor chips and other semiconductors form the country’s largest single import. Despite the country’s strong chip industry, China still relies on Taiwan, the US and Europe for certain parts. In China’s fourth session of the 13th National People’s Congress (NPC) held in early March, the party pledged to build up self-reliance in science and technology.
Questions & Answers
Q.Which specific companies have been affected by US sanctions, according to the article?
Which specific companies have been affected by US sanctions, according to the article?
The US sanctions mentioned in the article have impacted some Chinese companies, specifically naming tech giant Huawei and chipmaker SMIC. These sanctions were imposed before China announced its import tax cuts.
Q.What kind of technology does a chipmaker need to produce to qualify for the new tax cuts?
What kind of technology does a chipmaker need to produce to qualify for the new tax cuts?
To qualify for the import tax cuts, chipmakers must produce high-end 65-nanometer technology or smaller chips. This applies to the raw materials and machinery they import until 2030.
Q.How much are China's annual imports of processor chips and other semiconductors worth?
How much are China's annual imports of processor chips and other semiconductors worth?
China's annual imports of processor chips and other semiconductors total more than $300 billion. This makes them the country's largest single import category each year.
Q.Which countries does China still rely on for certain parts despite its own chip industry?
Which countries does China still rely on for certain parts despite its own chip industry?
Despite having a strong domestic chip industry, China still relies on Taiwan, the US, and Europe for certain specific parts. This highlights a continued dependence on foreign suppliers.
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