Chinese firms look to Malaysia to circumvent US sanctions
China's semiconductor design companies are reportedly hiring Malaysian firms to assemble graphics processing units as a hedge against more US export controls.
Thanks to the growing tension between Washington and Beijing, the US has placed controls on the ability of overseas chip makers to ship any US-made components to mainland China.
Now, according to Reuters, the Chinese are trying to find new suppliers to manage their advanced chip packaging operations. Why? Because the US does not currently impose sanctions on processes relating to assembly. Obviously, it's possible the US could extend its sanctions into this area in the future.
By cultivating Malaysian suppliers of graphics processing units (GPUs), China might be able to mitigate the damage of a future ban. Malaysia is regarded as an ally of China, with a skilled workforce and affordable products. It currently accounts for 13% of the global market for semiconductor packaging, assembly, and testing and is aiming to boost that to 15% by 2030.
Reuters reports that Chinese companies are already working with Malaysian chip packaging firms such as Unisem.