Chinese chip maker Jingjia Microelectronics, which is under U.S. sanctions, is planning to develop graphic processing units (GPUs) in Wuxi, Jiangsu province, in the latest sign of China’s efforts to achieve self-sufficiency in semiconductors despite Washington’s restrictions. According to a statement of the Wuxi High-Tech District, which will host the project, an initial agreement was reached between the Shenzhen-listed company and the district. While the investment size was not disclosed, the project is expected to generate CNY5 billion worth of output per year. The company earlier this year said it would raise CNY4.2 billion in private placements for GPU research and development (R&D).
The U.S., as well as allies Japan and the Netherlands, recently tightened their export rules to limit China’s access to advanced chip making tools needed to manufacture processors including GPUs, which are vital for artificial intelligence training. Jingjia Micro claims to be China’s leading developer of GPUs, although it lags far behind global peers such as Nvidia, the world’s leading supplier of GPUs. The Chinese company’s revenue in 2022 was only CNY1.2 billion, a fraction of Nvidia’s USD27 billion annual revenue. Based in Changsha, Hunan province, Jingjia was added to the U.S. Entity List in December 2021, denying it access to U.S. technologies, including chip design software, without U.S. approval. At the time, Jingjia said its addition to the blacklist would not have a material impact on its operations.
Three months before its inclusion on the U.S. trade blacklist, the company was flagged as a company connected with the Chinese military-industrial complex by the U.S. Treasury Department, which barred U.S. investors from buying its shares, bonds or any derivatives based on its securities. Jingjia Micro’s plan to tap into China’s semiconductor supply chain to produce GPUs highlights the country’s predicament in the aftermath of stringent U.S. export controls targeting China’s chip sector. The new U.S. rules, rolled out in October 2022, prevent China-based chip makers from advancing to nodes below 10-nanometer, which are increasingly required to power consumer gadgets and digital infrastructure.
Last year Taiwan Semiconductor Manufacturing Co (TSMC), which makes GPUs for Nvidia, suspended production of the BR100 GPU designed by Chinese start-up Biren Technology, after Washington updated its export controls. During the signing ceremony, Jingjia Micro’s Chairman and President Zeng Wanhui said that the company will leverage Wuxi’s strengths in the chip sector to “fully integrate the advantageous resources”, hoping for “early fruition” of the project in both “production and economic profits”. Jiangjia Micro claims it owns intellectual property rights to high-performance GPUs used in applications from signal processing and storage to small-sized radars, the South China Morning Post reports.
