“Any government considering a push for self-reliance in semiconductors needs to face the harsh reality,” said Christopher A. Thomas, a nonresident senior fellow at the Brookings Institution and Intel’s former general manager in China, in an interview. “Semiconductors represent the highest form of human engineering achievement. They are the most difficult thing we create as a species. How can one country ‘win it all’ by itself?”
Charles Kau, a Taiwanese semiconductor veteran who has worked on both sides of the Taiwan Strait, said in a recent newspaper interview that he had tried telling mainland tech executives many times that it could take China 30 — or even 50 — years to become an industry leader.
Such statements aren’t likely to be what Mr. Xi wants to hear. Expected to secure a third term at an important Communist Party congress this year, he is increasingly obsessed with tech “choke points” that have left China vulnerable amid the trade war with the United States, including bans on companies like ZTE, the potential war over the Taiwan Strait and Russia’s invasion of Ukraine. This month, President Biden signed into law a $280 billion bill aimed at strengthening domestic semiconductor manufacturing, design and research to compete with China.
To confront these challenges, Mr. Xi has increasingly reached back to Mao Zedong’s playbook when China was operating a planned economy and had few friends and self-reliance was a necessity. He doesn’t hide his fondness for the Mao era’s top-down approach to tackling big obstacles: mobilizing national resources, which he claims is a big advantage of China’s state-dominating political system.
Such inward and backward vision has come to define Mr. Xi’s views on how China should advance to become self-sufficient in tech and how fast. He has promoted technocrats from the space and defense industries who pulled off technologically challenging projects that he believes testify to the strength of China’s system.
The purged semiconductor executives didn’t live up to that criterion.
Zhao Weiguo, the YMTC chairman who stood behind Mr. Xi in a widely circulated photo of his 2018 visit, used to be the most high-profile person in the industry. He earned the nickname “semiconductor madman” after making a series of eye-popping investments in big chip projects through the company he controlled, Tsinghua Unigroup. He is best known in the West for his failed 2015 takeover of Micron Technology, a U.S. maker of memory chips.