China’s legacy chips to survive with price advantage

The European Union and the United States will not be able to achieve their goals of reducing their companies’ reliance on China’s legacy chips (28 nanometers or above) as the products have a price advantage, say Chinese state media and commentators.

The comments have come after Bloomberg reported on Monday that the EU-US Trade and Technology Council, established in 2021, will hold a meeting in Belgium in April to discuss whether western firms are over-relying on China’s mature or lower-end semiconductors.

The EU is considering joining the US in flagging a potential risk to national security and global supply chains, the report said, citing a draft working statement. It may investigate how deeply China’s legacy chips are embedded across industry networks.

“The EU and US will continue to collect and share non-confidential information and market intelligence about non-market policies and practices, and commit to consult each other on planned actions,” according to the draft.

The European Commission may launch a survey to try to understand the situation in the industry before launching any joint measures with the US, such as restrictions and other curbs.

At the beginning of this year, the US Commerce Department’s Bureau of Industry and Security (BIS) had already conducted a new survey to identify how US firms are sourcing current-generation and legacy chips.

China’s commentators in articles published Tuesday and Wednesday criticize the US for trying to suppress the growth of the Chinese legacy chip sector.

“It seems that the US has begun to adjust its strategy, consulting its allies to combat China’s chip exports,” Hu Weijia, a Chinese writer, says in an article published by the Global Times on Tuesday. “But it won’t be