America is ready to blacklist Semiconductor Manufacturing International Corp. and dozens of other Chinese companies, Reuters reported, citing people familiar with the matter.
Shares of China’s top chipmaker plunged by 4.3% in Hong Kong on Friday afternoon after Reuters outgoing president Donald Trump made preparations to include nearly 80 more companies and their associates in the Commerce Department’s entity list. They will join the likes of The Huawei Technologies company is on a list denying them access to American technology from software to circuitry.
Companies including Huawei and SMIC has been caught in the midst of deteriorating tensions between the world’s two largest economies, which clash with issues ranging from trade to epidemics. Trump was widely Joe Biden expected more sanctions against China’s national champion before he formally assumed office.
Shanghai-based company, a supplier to Qualcomm Inc. Broadcom Inc. is building on Beijing’s intent to build a world-class semiconductor industry and removes reliance on US technology. Washington in turn sees China as a potential geopolitical threat. A blacklisting threatens to deprive her critical ambitions of critical gear.
In response to the expansion of the US rift, China plans to extend broad support for so-called third-generation semiconductors in its next five-year plan to increase domestic self-sufficiency in chip manufacturing, people familiar with the matter have said. SMIC is supported by the China Integrated Circuit Industry Investment Fund and the Sovereign Fund of Singapore GIC PTE and The Abu Dhabi Investment Authority is expected to play a central role in that overall effort.
Representatives of SMIC did not immediately respond to requests for comment.
– With the help of Edwin Chan, and Yuan Gao
(Update with share action from second paragraph)