U.S. Companies Aid China’s Bid for Chip Dominance Despite Security Concerns, Wall Street Journal, Nov. 12, 2022.

Afternoon Tea For You

By Kate O’Keeffe, Heather Somerville and Yang Jie

U.S. firms and their China af­fil­i­ates are ramp­ing up in­vest­ment in Chi­nese semi­con­duc­tor com­pa­nies, aid­ing Bei­jing’s bid for chip-sec­tor dom­i­nance and com­pli­cat­ing Wash­ing­ton’s ef­forts to pre­serve Amer­i­ca’s lead in the crit­i­cal tech­nol­ogy, a Wall Street Jour­nal in­ves­ti­ga-tion has found.

U.S. ven­ture-cap­i­tal firms, chip-in­dus­try gi­ants and other pri­vate in­vestors par­tic­i­pated in 58 in­vest­ment deals in Chi­na’s semi­con­duc­tor in­dus­try from 2017 through 2020, more than dou­ble the num­ber from the prior four years, ac­cord­ing to an analy­sis of deals data by New York-based re­search firm Rhodium Group done at the Jour­nal’s re­quest.

Ma­jor chip com­pany In­tel Corp. is among the ac­tive in­vestors, back­ing a Chi­nese com­pany now called Pri­mar­ius Tech­nolo­gies Co., which spe­cial­izes in chip-de­sign tools that U.S. com­pa­nies cur­rently lead in mak­ing, a sep­a­rate Jour­nal re­view of data from an­a­lyt­ics firm Pitch­Book Data Inc. shows.

Be­yond that, the China-based af­fil­i­ates of Sil­i­con Val­ley ven­ture firms Se­quoia Cap­i­tal, Light­speed Ven­ture Part­ners, Ma­trix Part­ners and Red­point Ven­tures have made at least 67 in­vest­ments in Chi­nese chip-sec­tor com­pa­nies since the start of 2020, the Jour­nal found.

(To be continued…)