Cutting off the supply of a critical technology is a double-edged sword. Short-term sure you starve them of that technology. But now you’re encouraging them, with great urgency, to develop that technology stack domestically. Which they may not have done if it was readily, and cheaply available for import.

That’s great! I’ll believe it when I see it.

This is the best summary I could come up with:

China’s national chip champions expect to make next-generation smartphone processors as early as this year, despite US efforts to restrict their development of advanced technologies.

The country’s biggest chipmaker, SMIC, has put together new semiconductor production lines in Shanghai, according to two people familiar with the move, to mass-produce the chips designed by technology giant Huawei.

That plan supports Beijing’s goals of chip self-sufficiency, with President Joe Biden’s administration tightening export restrictions for advanced chipmaking equipment in October, citing national security concerns.

The phone helped it to increase shipments in China by nearly 50 percent in the fourth quarter, according to Canalys research, as it proved a big hit with consumers.

If production is judged successful enough for smartphones, Huawei’s most powerful artificial intelligence processor, the Ascend 920, will also be produced at 5 nm by SMIC, the two people said, narrowing the gap between China’s alternative AI chips and Nvidia’s highly sought-after graphics processing units.

“SMIC is facing a more significant roadblock for production expansion after the US and its alliance tightened export restrictions on advanced chipmaking gear,” said one person close to the company.

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