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The backstory: Changxin Xinqiao Memory Technologies is a relatively fresh-faced Chinese semiconductor start-up that entered the tech arena in 2021. Founded with a focus on memory solutions, it has familial ties with the heavyweight Changxin Memory Technologies, a DRAM chip giant in Hefei, China.
Now, the global tech scene was already simmering with tension between the US and China. The US had laid down restrictions on exporting high-tech chips and chipmaking gear to Chinese companies. The concern? Potential national security risks, especially in the context of China's military ambitions. Meanwhile, Beijing has been on a mission to boost domestic chip production. A highlight in this race was Huawei's 5G phone, released in September, featuring advanced chips from Semiconductor Manufacturing International.
More recently: In the world of domestic semiconductor funding, the China Integrated Circuit Industry Investment Fund, aka the "Big Fund," has played a crucial role. It backs major Chinese chip companies like SMIC and Hua Hong Semiconductor. In September, reports hinted at China's plan to create a US$40 billion state-backed investment fund to put toward the nation’s semiconductor industry as a part of the Big Fund’s efforts.
The development: Changxin Xinqiao just locked in 39 billion yuan (around US$5.4 billion) in its latest funding round. Of this, a significant 14.6 billion yuan (US$2 billion) stemmed directly from the state-backed China Integrated Circuit Industry Investment Fund Phase II and funding from two other investors linked to the local government. The company is hoping to compete with leaders in the global industry, like Micron Technology and Samsung Electronics. Bloomberg also reported earlier this year that it’s planning to file for an initial public offering (IPO) in China that could value it at more than US$14.5 billion.
"To open up new areas and new arenas in development and foster new growth drivers and new strengths in face of fierce international competition, China should ultimately rely on scientific and technological innovation," said Chinese President Xi Jinping in March.
“We share US$700 billion dollars of trade, and I concur with you that it is profoundly important that we have a stable economic relationship,” said US Commerce Secretary Gina Raimondo in a meeting with Chinese Minister of Commerce Wang Wentao back in August.“It’s a complicated relationship; it’s a challenging relationship. We will of course disagree on certain issues, but I believe we can make progress if we are direct, open and practical.”
“Technological innovation has become the main battleground of the global playing field, and competition for tech dominance will grow unprecedentedly fierce,” President Xi said in 2021.