China’s Hua Hong prepares 7 nm chip production amid push for tech self-sufficiency

Beijing — China’s Hua Hong Group has developed advanced chip manufacturing technologies capable of producing artificial intelligence (AI) chips, according to four individuals familiar with the matter. This development marks a significant step in Beijing’s ongoing efforts to achieve greater self-reliance in the technology sector.

The group’s contract chipmaking division, Huali Microelectronics, is preparing to launch a 7-nanometre (nm) chipmaking process at its Shanghai facility, the sources said. If successful, Hua Hong would become the second Chinese chipmaker to possess such advanced manufacturing capabilities. Currently, Semiconductor Manufacturing International Corporation (SMIC), China’s largest contract chipmaker, is the only domestic firm able to produce chips using 7 nm technology.

This advancement comes at a time when the United States has relaxed certain technology export controls since last year, allowing Nvidia to sell its second-most-powerful AI chips to Chinese customers. Despite this easing of restrictions, Chinese authorities have continued to encourage domestic companies to opt for locally produced alternatives, as part of a broader strategy to reduce dependence on foreign suppliers.

Hua Hong is recognized as China’s second-largest chipmaker. The company’s progress in 7 nm chip technology is seen as a major milestone in the country’s efforts to bolster its domestic semiconductor industry and enhance its technological self-sufficiency.