Is China ‘Stealing’ Taiwan’s Chipmaking Technology?

Taiwan’s top diplomat in the US has accused China of ‘cheating’ and ‘stealing’ technologies for making semiconductor chips. Alexander Yui in an interview to Reuters, picked up by Indo-Pacific News – GeopPolitics & Defense News, he was quoted as claiming that China was trying to rival Taiwan’s prowess in semiconductors through dishonest means, including intellectual property theft.

He said China was circumventing the standard practices of innovation and resorting to dishonest methods to advance their capabilities.

“They do not follow the rules,” Reuters quoted him as saying, “they cheat and they copy. They steal technology.”

In fact in the early 2000, China’s Semiconductor Manufacturing International Corp (SMIC), was found guilty of stealing the process technologies of Taiwan’s TSMC. Taiwanese investigators have probed numerous Chinese companies suspected of poaching semiconductor engineers and other tech talent. But China maintains that it has done no wrong.

“Our development is always built on our own strength,” Liu Pengyu, spokesman of the Chinese embassy in Washington DC told Reuters. “China’s technological achievements are never made through cheating and stealing. We are confident of continuing to strengthen China’s capability to seek self-reliance and technological innovation.”

But Yui was skeptical if China could make viable next-generation processors as early as this year given US efforts to prevent Beijing from developing advanced technologies. US companies are restricted by Washington from providing technology without a special licence to certain Chinese chipmakers, including SMIC, given their work with China’s military.

“Those Chinese companies that they have spent billions of dollars on, have basically floundered,” Yui said.

The US says China uses its huge market and control over supply chains to coerce countries to transfer strategic technologies, and its extensive cyber theft makes it the major threat to US technological competitiveness.

However, 5 nanometre and 7 nanometre process nodes are so sophisticated it is virtually impossible for anyone to steal them. China has therefore resorted to hiring specialists from TSMC and Samsung to develop them in house.