Ad Banner
Advertisement by Open Privilege

China's semiconductor exports surge amid US tariff tensions, but future uncertainty looms

Image Credits: UnsplashImage Credits: Unsplash
  • China's chip exports surged 17.4% in 2024, reaching $160 billion, despite escalating US export controls.
  • Temporary US tariff exemptions on electronics offer short-term relief, but further restrictions are likely under review.
  • Chinese tech firms are exploring offshore production, notably in Malaysia, to bypass US trade barriers.

[WORLD] China's semiconductor exports have experienced significant growth, reaching approximately USD 160 billion in 2024, marking a 17.4% year-on-year increase. Despite escalating US tariffs and export controls, the nation's chip industry has demonstrated resilience. However, recent developments, including partial tariff exemptions and potential future restrictions, introduce a new layer of uncertainty for the sector.​

Resilient Growth Amid Trade Tensions

In 2024, China's integrated circuit exports set a historical record, totaling USD 159.5 billion. This achievement marked the 14th consecutive month of growth, underscoring the sector's robustness despite intensified US export controls and sanctions targeting Chinese tech giants like Huawei and ZTE.​

The expansion is attributed to China's strategic focus on mature semiconductor processes, which now account for a larger share of global production capacity. Collaborations with European chipmakers, such as STMicroelectronics and NXP, have further bolstered the sector's capabilities.​

China has also accelerated its investments in domestic semiconductor production, allocating over USD 40 billion in subsidies through state-backed funds such as the National Integrated Circuit Industry Investment Fund. These efforts aim to reduce reliance on foreign technology and develop indigenous alternatives to key components like lithography machines, which are currently dominated by Dutch firm ASML. Despite technical hurdles, domestic firms such as SMIC have made incremental advances in chip fabrication technologies, particularly in nodes above 14nm.

In parallel, the government has introduced favorable tax policies and fast-tracked infrastructure projects to support new chip fabrication facilities across provinces including Guangdong, Jiangsu, and Anhui. Industry analysts suggest these moves could enable China to close the technological gap with global leaders, particularly in legacy and mid-range semiconductor segments where demand remains high.

US Tariff Exemptions: Temporary Relief or Prelude to Stricter Measures?

In April 2025, the US administration announced exemptions for certain electronic products, including smartphones, laptops, and semiconductors, from new tariffs. This move led to a surge in tech stocks, with companies like Apple and Nvidia experiencing significant gains.​

However, these exemptions are not without caveats. Products remain subject to existing tariffs and may be reassigned to different categories, potentially leading to future restrictions. Commerce Secretary Howard Lutnick indicated that additional tariffs targeting semiconductors and tech components could be introduced under a separate investigation.​

Meanwhile, bipartisan sentiment in Washington continues to push for stricter oversight of tech-related exports to China. Recent legislation introduced in Congress seeks to broaden the scope of export controls, particularly for AI chips and advanced semiconductor manufacturing equipment. This legislative momentum reflects growing national security concerns over China's potential use of these technologies in military and surveillance applications, a stance echoed by several US allies.

Strategic Shifts and Market Dynamics

In response to escalating tariffs, some Chinese firms are considering relocating production to countries like Malaysia to circumvent US duties. These companies have sought assurances from the Malaysian government regarding tariff exemptions for locally manufactured products.​

Despite these strategies, the global semiconductor market remains volatile. Analysts project a 45% chance of a US recession, which could further impact demand for electronic products and, by extension, semiconductor exports.​

Adding to the complexity, geopolitical developments in the Asia-Pacific region are influencing global supply chain decisions. Rising tensions in the Taiwan Strait have prompted multinational companies to reevaluate risk exposure and diversify manufacturing bases. Taiwan’s TSMC, a dominant player in advanced chipmaking, has reiterated its plans to expand operations in the US and Japan to mitigate geopolitical threats and meet Western demand outside of Asia.

While China's semiconductor exports have demonstrated remarkable growth, the industry's future is clouded by ongoing trade tensions and potential policy shifts. The sector's ability to adapt to these challenges will be crucial in maintaining its upward trajectory.​

As global markets await further developments, stakeholders are advised to monitor policy changes closely and consider strategic adjustments to mitigate risks associated with the evolving trade landscape.​


Ad Banner
Advertisement by Open Privilege
Tech World
Image Credits: Unsplash
TechApril 28, 2025 at 9:30:00 AM

Huawei launches AI chip to rival Nvidia

[WORLD] Huawei, the Chinese telecommunications giant, has unveiled a new AI chip designed to rival Nvidia's dominance in the burgeoning artificial intelligence (AI)...

Tech Europe
Image Credits: Unsplash
TechApril 24, 2025 at 1:00:00 PM

Tesla faces decline in EU sales amid rising competition

[EUROPE] Tesla’s sales in the European Union took another significant hit last month, marking a continued downturn that has raised questions about the...

Tech Europe
Image Credits: Unsplash
TechApril 24, 2025 at 8:30:00 AM

EU fines spark US fury over tech crackdown

[EUROPE] The United States has sharply criticized the European Union's recent imposition of significant fines on American tech giants Apple and Meta, labeling...

Tech United States
Image Credits: Unsplash
TechApril 24, 2025 at 8:30:00 AM

X challenges Minnesota deepfake ban

[UNITED STATES] Elon Musk’s social media company, X, filed a lawsuit against the state of Minnesota on Wednesday, challenging a newly enacted law...

Tech United States
Image Credits: Unsplash
TechApril 23, 2025 at 9:00:00 AM

Trump Media expands into crypto and financial services

[UNITED STATES] Trump Media & Technology Group (TMTG), the parent company of Truth Social, is intensifying its foray into the cryptocurrency and financial...

Tech World
Image Credits: Unsplash
TechApril 23, 2025 at 9:00:00 AM

Intel slashes workforce in strategic shift

[WORLD] Intel Corporation has revealed plans to reduce its global workforce by more than 20%, marking a significant step in CEO Lip-Bu Tan's...

Tech World
Image Credits: Unsplash
TechApril 23, 2025 at 8:00:00 AM

Tesla’s auto show absence fuels Chinese EV dominance

[WORLD] Tesla’s third consecutive absence from China’s largest auto show has provided a significant opportunity for domestic competitors to take center stage, with...

Leadership World
Image Credits: Unsplash
LeadershipApril 22, 2025 at 8:30:00 PM

How entrepreneurs can keep up with the quickly changing AI law

[WORLD] As artificial intelligence (AI) continues to revolutionize industries worldwide, business owners face the critical challenge of staying abreast of rapidly evolving AI...

Tech United States
Image Credits: Unsplash
TechApril 22, 2025 at 11:30:00 AM

Google faces antitrust reckoning

[UNITED STATES] The U.S. Department of Justice (DOJ) has initiated a landmark antitrust trial against Alphabet Inc.'s Google, alleging that the tech giant...

Tech World
Image Credits: Unsplash
TechApril 21, 2025 at 4:00:00 PM

EV makers face autonomous tech crackdown at China Auto Show​

[WORLD] At the 2025 Shanghai Auto Show, Chinese electric vehicle (EV) manufacturers are seizing the spotlight with a wave of new, competitively priced...

Tech World
Image Credits: Unsplash
TechApril 21, 2025 at 12:30:00 PM

Moscow court convicts Google over Russian war casualties

[WORLD] A Moscow court has found tech giant Google guilty of disseminating personal information related to Russian military casualties in the ongoing Ukraine...

Tech United States
Image Credits: Unsplash
TechApril 18, 2025 at 8:30:00 AM

Trump hints at tariff relief as TikTok deal stalls

[WORLD] U.S. President Donald Trump said on Thursday that the tit-for-tat tariff rises between the United States and China that have stunned markets...

Ad Banner
Advertisement by Open Privilege
Load More
Ad Banner
Advertisement by Open Privilege