Huawei Technologies Co. and Semiconductor Manufacturing International Corp., already blacklisted by the U.S., launched a new phone using highly advanced technology that has sparked concern in Washington. To help you understand what is going on in the trade/China landscape and what we expect may happen in the future, our highly experienced Kiplinger Letter team will keep you abreast of the latest developments and forecasts (Get a free issue of The Kiplinger Letter or subscribe). You'll get all the latest news first by subscribing, but we will publish many (but not all) of the forecasts a few days afterward online. Here’s the latest…
China’s big chip breakthrough is less than meets the eye. Recent news, that telecom giant Huawei collaborated with China’s largest chipmaker, Semiconductor Manufacturing International Corporation (SMIC) on an advanced processor to power its latest smartphone, set off alarm bells in Washington.
But the chip they produced is still five years behind the cutting edge — an eternity in semiconductor time. And without access to more advanced equipment, which is limited by export controls, Beijing will struggle to produce additional breakthroughs, despite heavily subsidizing various semiconductor manufacturing initiatives.
Sign up for Kiplinger’s Free E-Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
Nevertheless, don’t be surprised if Uncle Sam further tightens restrictions on China’s access to semiconductor manufacturing equipment. By some accounts, U.S. enforcement of export controls has been less stringent than expected, a consequence of industry lobbying.
But critics also say these regulations were poorly designed, allowing China to access less-advanced equipment still capable of making more advanced chips, though not well enough to be commercially viable.
This forecast first appeared in The Kiplinger Letter, which has been running since 1923 and is a collection of concise weekly forecasts on business and economic trends, as well as what to expect from Washington, to help you understand what’s coming up to make the most of your investments and your money. Subscribe to The Kiplinger Letter.
Related Content
-
How to Use a Dependent-Care FSA to Lower Child Care CostsWith a dependent care FSA, you can set aside pretax funds to cover care expenses.
-
Got $1,000? Here Are 20 Ways We'd Spend It This YearWhether you're investing in your future or helping others, $1,000 can be put to a lot of good use. We've rounded up some ways to save, donate or spend it.
-
Kiplinger Outlook: Telecom Companies Brace for Tough TimesThe Letter The telecom industry is entering a new era that threatens profitability. But the coming Trump administration will make it easier for the major players to adjust.
-
Tax Changes are on Trump's 2025 To-Do ListThe Tax Letter Donald Trump campaigned on lower taxes and, as president, he will push Congress to pass big tax changes next year
-
Start-ups Trying to (Profitably) Solve the World’s Hardest ProblemsThe Letter More investors are interested in companies working on breakthrough science to tackle huge societal challenges. The field of deep tech has major tailwinds, too.
-
Harris vs. Trump's Tax Wish List: Income Tax, Capital Gains, Estate Tax and MoreThe Tax Letter Take a comprehensive look at Harris and Trump's tax proposals. We cover income tax rates, tax credits and deductions, capital gains tax, estate tax, corporate tax and much more
-
What are Trump's Positions on Capital Gains Taxes?The Tax Letter Harris and Trump have different views on taxing capital gains. See what Trump said he would do if elected to the White House.
-
The Big Questions for AR’s FutureThe Letter As Meta shows off a flashy AR prototype, Microsoft quietly stops supporting its own AR headset. The two companies highlight the promise and peril of AR.
-
China's Economy Faces Darkening OutlookThe Letter What the slowdown in China means for U.S. businesses.
-
AI Start-ups Keep Scoring Huge SumsThe Kiplinger Letter Investors continue to make bigger bets on artificial intelligence start-ups, even for small teams with no revenue. Some backers think a startling tech breakthrough is near.
