In April, 2018, the Trump administration announced that it would implement an embargo prohibiting U.S. companies from selling core components, including semiconductor chips, to the Chinese company ZTE. {The company was punished because it violated the United States sanctions against Iran and North Korea and then lied about it.} ZTE’s main business became paralyzed at once. China’s neck was being chocked in the area of core technology. This instantly sent a shockwave across China’s ruling circles and society. In the short one month period since the incident took place, Xi Jinping, China’s top leader, has spoken out about it five times. He said that “a great power can’t rely on other people for important tools.” He issued a call to catch up with the core technology.
As the whole country talked about the ZTE incident and disputed the policies over {the development of technology}, China’s official press published Xi Jinping’s new book, Excerpts from Xi Jinping’s Discussion of the Overall National Security Concept. In the book, Xi raised the core technologies issue to the level of national security. The book stated, even before the recent ZTE incident and the Sino-U.S. trade friction, that Xi had decided that China should have control of its own chips, operating systems and other core technologies. In his two speeches in July and August, 2013, Xi claimed that having the advantage of core technologies is essential to gain a strong international presence. “We must make great efforts in key areas and areas where our necks can be choked. This is also true for the military.” Although China has spent a lot of money on upgrading its military, in a speech in 2014, Xi still warned the military because it lagged behind in technology.
On April 17, 2018, the official media People’s Daily published an article responding that China “will increase its investment in chips at any cost.” The media then published news that China would increase capital by another 500 billion yuan (US $78 billion) for a special fund that had first been established in 2014, which will focus on supporting China’s domestic chip production and technology. The support will target three areas, including memory chips, integrated circuit designs, and compound semiconductors.
On May 16, 2018, Xi Jinping inspected the Academy of Military Sciences and re-emphasized the acceleration of independent innovation to achieve breakthroughs in core technologies as soon as possible. In connection with Xi’s recent formation of the Military and Civil Integration Development Committee, this seems to indicate that Xi’s intention is to have the military and military departments take the lead in catching up with China’s core technology.
Source: Duowei News, May 22. 2018
http://news.dwnews.com/china/news/2018-05-22/60059635.htmlfo