Coronavirus pandemic updates: Rise of US white supremacy portends new cold war or worse?

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Mapping the Coronavirus Outbreak Across the World

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With the novel coronavirus spreading around the globe, a political virus with deeper influence has also begun to show up. In recent years, white nationalism and white supremacy have been on the rise, a perfect reflection of a political virus that is spreading in the US. If Washington cannot appropriately deal with this virus, it will not be able to make the US great again but rather see an irreversible decline and fall of the US empire.

As of Tuesday, the US has reported at least 163,000 cases of COVID-19 and over 3,000 deaths from the virus. These fast rising numbers have failed to sober some US politicians, especially those who are anti-China, who regard the virus as an opportunity to expand their political interests.

The US is in a political mess with different forces striving to gain an upper hand in a game of political competition. The far-right forces represented by former Trump White House strategist Stephen K. Bannon have been on the frontline and haven't missed an opportunity to attract attention with extreme rhetoric.

Bannon has said that the Chinese government is "an existential threat to the Chinese people and to the world, not just the US." This is a typical statement aimed at gaining political support by pitting China and the world against each other. People like Bannon are actually spokespersons for white nationalism and white supremacy, and they label China an enemy to realize their political goals. These people have fanned the flames of extreme nationalism, which will cause the US to suffer first.

US history shows us that the country needs an enemy to push its development. This is pathetic, yet white nationalists still attempt to unite Americans by making up an enemy. The enemy used to be the Soviet Union, and now it's China, even though today's China is nothing like the Soviet Union.

When the term "American Century" was coined in the 1940s, the US was urged to become the world's Good Samaritan and thus a leader across the globe. Hence, in the eyes of some US politicians obsessed with the extreme mind-set of ideological competition, China has been targeted as a thorn in the side of the US.

Such being the case, Bannon and his followers have spared no efforts to smear China. They will continue spreading their political virus in the hope of reaching their ultimate goal of overthrowing China. These people on the far fringe of US political debate view this as the easiest way to make the US great again.

However, they know it's not possible for them to overturn the Chinese government, but they can't let go their paranoia. Therefore, they won't even hesitate to fulfill their self-gratification even if it drags the US into a hostility confrontation or even a war against China. In the era of globalization, the US will definitely harm itself and its people if it launches a cold war with China.

Nonetheless, if this racism-related political virus continues spreading and more people are deceived by extreme speech, the US will see its existing lesions develop into a malignant tumor. If that occurs, it won't only be the vast innocent Americans who will suffer, but also the politicians who care only about their political interests.

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Coronavirus pandemic accelerated as West’s sense of superiority caused failure to act promptly and lies about China

The West is trying to deflect blame, exacerbated by a mind-set which interprets disease outbreaks not as an inevitable aspect of the human condition, but something belonging to exotic, oriental and poorer nations.

US, UK politicians can't twist virus public opinion 

It is absurd to accuse China of a disinformation campaign or attempt to hold China accountable. And this cannot and will not stop US and British societies from digging out the real reason and criticizing those who made them suffer the pandemic.

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Anti-China chorus can't mask country's contributions to virus fight

The US and some other Western countries have been recently launching continuous public opinion attacks on China from changing perspectives. They accused China of concealing data on the number of COVID-19 infections and deaths, politicized disputes over the quality of certain medical supplies shipped from China to the West, threw mud at China's diplomacy and demanded China be held accountable for the coronavirus outbreak, as if they are in tune with a new anti-China chorus.

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How China can end US rivalry and realise its vision of a shared future for humanity, as the world struggles with the pandemic

The US-China rivalry only feeds the pandemic, when global cooperation is needed. This is where China’s vision of a shared destiny for humanity can be useful, provided it can be elevated above suspicions of a Beijing power grab

I cannot imagine richer nutrients for the novel coronavirus to reproduce and spread, to flourish globally, than the United States and China continuing to descend into unabashed and undisguised rivalry, with escalating accusations each against the other. Nourish the virus with US-China competition. Or starve the virus with US-China cooperation.

Never has such cooperation been needed more urgently – to battle and contain the pandemic and to sustain and bolster the world economy. Containing the global pandemic, like bolstering the global economy, depends on US-China collaboration.

. If climate change is the world’s most intractable chronic problem, then Covid-19 is the world’s most severe acute problem. My two favourite countries have a choice: either work together to fight the pandemic, developing drugs and vaccines to kill and stop Covid-19, or suffer an out-of-control global pandemic and a chain-reaction cratering of the global economy. Truly, nations will fight the virus and collectively win, or fight each other and collectively lose.

Although China has well-earned respect for curbing its outbreak, there is room for critique, correction and improvement. President Xi Jinping stresses drawing lessons from the outbreak to improve the country's systems for major epidemic control, prevention and public health emergency management.

Apropos of the pandemic, Xi’s repeated call to build “a community with a shared future for all humanity” is a grand vision with multiple applications. For seven years, it has driven foreign policy, especially the Belt and Road Initiative , helping to rectify global imbalances.

https://youtu.be/v34MfJJAZA0

While fighting disease or controlling pandemics have always been a “shared future” benefit, it was always tucked within lists of other benefits, such as climate control, preventing terrorism, interdicting drugs and the like. Few ever imagined that a pandemic could become so grave so fast. But as the pandemic has burst into planetary consciousness, it demonstrates viscerally the global criticality of “shared future” thinking.

The challenge for China is to elevate Xi’s vision above what appears to some as competitive positioning or even as a sprint to assert China’s leadership. China’s experience in containing the contagion, which many countries now desperately need, provides just such an opportunity.

By sending “battle-tested” medical teams to countries under siege, China brings to bear experts with contemporary frontline epidemic experience. What is not well appreciated in the tops-of-trees daily recitations of cases and deaths are China’s evolved know-how and the meticulous work of Chinese health care and logistics professionals.

Exporting coronavirus knowledge, China sends medical teams to countries to help fight pandemic https://youtu.be/jTtqB-zVUAw

There is a problem, though. Emotions worldwide are frayed, rubbed raw by the pandemic’s daily-life disruptions, with economic devastation threatening to exceed that of the 2008 global financial crisis. In this toxic psychological environment, when non-stop news, especially in social media, amplifies fantastical, scurrilous, unsubstantiated rumours by insensitive officials or block-brained conspiracy theorists, attitudes harden and antagonisms ossify. Indigenous nationalism flares in vicious circles.

It takes no cleverness to inflame feelings with glib rhetoric or political insults. Rational people must work together, not allow fringe invective to erode the capacity to fight a common enemy.

Containment of the polemic will be more challenging than containment of the coronavirus; the latter likely to burn out before the former. If so, Chinese views of America, and American views of China, are only going to deteriorate further, to the detriment of all. Enlightened leadership should temper, not inflame, indigenous nationalism. We cannot allow mutual exhaustion to be our last hope.

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China’s vision of “a community with a shared future for mankind”, exhorting all nations to act for the common good, fits our turbulent times. For this reason, China should resist finding this phrase turned into a cliché or satire, catalysed inadvertently by endless repetition or forced conformity into a single expression or translation.

Why not encourage various expressions, enabling officials and experts to use their own words, thereby enriching the vision, keeping it fresh and timely?

Originally, the English translation was “a community of common destiny for mankind”, which is more literal and rather elegant. But then, I was told, “destiny” was deemed to be too passive or fatalistic, not sufficiently proactive and positive, which led to the less literal “shared future”. “Shared future” is an evocative phase, reflecting Chinese tradition and offering hope for a better tomorrow.

Yet with constant repetition, “a community with a shared future for mankind” can begin to sound, paradoxically, like an exclusive Chinese mantra, and thereby can begin to elicit, in some countries or cultures, negative emotions, instead of conveying positive contributions.


Labels carry messages – and some interpret China’s phrase as seeking to get the whole world to march under its national banner. This misreads China, but by triggering resistance, the static phrase undermines China’s capacity to help bring about in reality such a community of common destiny or shared future.

China’s vision is a universal message shared by many cultures and China might reach out for similar ideas. China’s challenge is to express the vision in language with which other cultures can identify and feel comfortable supporting.

To be clear, read literally and without bias, a “community with a shared future for mankind” is a powerful exhortation that should benefit the world. That is why the phrase should be protected and enriched by also allowing other, diverse English phrases to represent the original Chinese.

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The objective is to enable the global community to take collective ownership of the grand vision. Given the global pandemic, the global community must take collective ownership.

Here are three other possible expressions, the first more literal, the second and third taking more explanatory licence: humanity is a community of common destiny (a shared future); humanity’s common destiny (shared future) is the guiding principle of our times; and, recognise humanity’s common destiny (shared future) to build a global community.

What China seeks is what humanity needs, especially with the pandemic, and it behooves people of goodwill everywhere to work together to transform rhetoric into reality. - South China Morning Post.

By Robert Lawrence Kuhn, a public intellectual and international corporate strategist, won the China Reform Friendship Medal (2018)


Robert Lawrence Kuhn is a public intellectual, international corporate strategist and investment banker, and a China political/economics commentator featured on the BBC, CNN, Bloomberg. For more than 25 years, he has worked with China’s leaders. He has published over 30 books, including How China’s Leaders Think (featuring President Xi Jinping), and The Man Who Changed China: The Life and Legacy of Jiang Zemin. He is the host of Closer to China with R.L.Kuhn on CCTV News.

Coronavirus outbreak Coronavirus outbreak: All stories | US-China relations | US-China trade war | US-China trade war: Opinion | US-China trade war: All stories | Belt and Road Initiative | Belt and Road: Comment | China leadership

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Meltdown and challenging times and profiting from market downturn

starbiz@thestar.com.my

https://youtu.be/Ue6N787O4SI

IT is trying times for everyone as the global financial world melts down but the order of the day is really to stop the spread of coronavirus (Covid-19) so that some normality could return.

Ironically, two things seem to be rising amid the turmoil – the demand for toilet paper caused serious fights in supermarkets across the globe and this has gone viral across various networks.

The other is the US dollar. Its rise has many reasons.

Everything else, including stock markets, oil, bonds, commodities, currencies and bitcoin are plunging to new lows with no clear signs of immediate reversal. Just in a month the FBM KLCI is down by 20% while the Dow Jones Industrial average 31%.

The rise in demand for toilet paper cannot be comprehended but the rise of the US dollar in a mayhem is understandable. Corporations across the global are rushing to draw down credit lines and seek the US dollar for their funding needs.

In fact, people are scrambling for the US dollar and as a report said “world markets are still very, very nervous ...people are scrambling for cash any way they can.’’

Ringgit against the US dollar has reached the RM4.41 range.

Bonds are also seeing the biggest wave of withdrawals since 2017 and gold has fallen as there are concerns of a global economic recession.

The timing of the Saudi Arabia-russia oil price war was shocking and a report said it is a “risky move likely to further destabilise a world economy that is already wobbly with the pandemic.’’

Oil has plummeted to about US$30 a barrel and experts believe it could plunge to US$20 a barrel though the Us-trump Administration may intervene as US producers are suffering from the historic crash in prices.

Amid all these fears, governments across the globe are coming out with stimulus packages to help its citizens and businesses. It is a much needed aid as many countries have enforced total lockdown and people on daily jobs need money for survival. The US alone is forking out US$1 trillion in aid. Other countries have set aside billions of dollars including Malaysia Rm20bil.

StarBiz compiled by B.K. SIDHU & EUGENE MAHALINGAM

Profiting from market downturn 

Investment strategy: The benefit of dollar-cost averaging is that you don’t have to monitor the price movement and you don’t have to make a decision every time you want to invest. In fact, dollar-cost averaging is quite a no-brainer strategy.

MOST people tend to be very bearish about the stock market after a crash. In fact, most investors would feel that it would be best to avoid the stock market for now.

Some may even want to cut their current investment losses and get out of their investments in equities, even though seasoned investors would tell you that the best opportunity to enter the market would be after a market crash

Following the recent global stock market downturn, market sentiments, the desire and motivation to invest is at an all-time low. Understandably so, after all, once bitten twice shy.

However, the legendary “Oracle of Omaha” and one of the most successful investor of all time, Warren Buffett, once said that as an investor, it is wise to be “fearful when others are greedy, and greedy when others are fearful.”

It’s hard, if not impossible, to convince oneself to invest when the whole world is panicking.

On one hand, you think the market crash is so sharp that you are fearful it may drop even further. On the other hand, you can clearly see that premium stocks are now trading at a great discount, and hence now would be a great opportunity to snap them up. What should you do?

If this is your dilemma, there’s an investment strategy that can help you to take advantage of the market downturn and allay your fear: the method is called dollar-cost averaging.

How dollar-cost averaging operates

Dollar-cost averaging is a strategy to invest a specific amount of money in the market at routine intervals (monthly, quarterly, half-yearly or yearly). Done right, you can protect yourself against fluctuations and downside risk in the market.

For example, instead of investing a lump sum of, say, RM120,000, you invest RM10,000 a month over one year. By doing this, you average out the cost of investments over an extended period of time. This is to make sure you don’t invest all your money at the peak of the market.

On the other hand, this strategy works especially well in an extended market downturn (like what you expect now) as you will keep buying at lower and lower prices until the market recovers.

For example, you invest RM1,000 in an equity unit trust fund at RM1 per unit. So, you end up with 1,000 units. The following month, you invest another RM1,000 in the same fund but because the unit price has dropped to 50 sen, you end up with 2,000 units.

So, what is the average cost of all your units? If your answer is 75 sen, you’re wrong. That’s because you have used the arithmetic mean (RM1+50sen/2>75 sen). You should use the harmonic mean.

This is how to calculate the average cost of all your units correctly: Your total investment is RM2,000 and you have 3,000 units of the fund. Divide RM2,000 by 3,000 units and the average cost is 67 sen. This means by using harmonic mean calculation, dollar-cost averaging gives a lower average cost.

How it helps you to profit from current market

Now, let’s see how we can apply dollar-cost averaging strategy to the current market scenario. You’re bearish about the market and think it will go down for another six months.

Dollar-cost averaging works well if you believe the market will continue to go down.

With reference to Table 1, if you invest RM1,000 a month for the next 12 months, you would have invested RM12,000 and accumulated 25,648 units at the end of the period. At 80 sen (which is lower than the original price), your investment value at the end of the period is RM20,518 (80 sen x 25,648 units).

It means that you would have gained RM8,518 (RM20,518 – RM12,000). That’s a 71% gain over 12 months, despite the fund price being beaten down by as much as 78% (90 sen – RM0.20 = 70 sen, then divided by 90 sen = 78%).

Why it can help you

Dollar-cost averaging is a discipline that can help investors overcome their emotion, dilemma and other human feeling when it comes to investing, be it fear or greed. We’re always tempted to invest when the market is high and so we end up buying high instead of buying low. With dollar-cost averaging, we’re automatically programmed to buy less units at higher prices and more units at lower prices instead.

Thus when the market crashes and prices are low like now, we would be empowered to invest, not react out of fear.

For this strategy to work, you would need to invest a specific amount of money at specific intervals, say RM10,000 a month over one year, no matter what the market condition is in. If you think that the market may crash and rebound in a shorter period, you may want to implement the strategy within one month. For example, RM30,000 a week over a one-month period. It does not matter which interval, what’s important is that it’s done consistently.

Your current investment strategy to buy only when the price has dropped to a certain “attractive” level is commendable. However, to execute this strategy well, you must be disciplined enough to monitor the market movement closely and spend time and energy to decide when would be the right time to buy the investment.

The benefit of dollar-cost averaging is that you don’t have to monitor the price movement and you don’t have to make a decision every time you want to invest. In fact, if you’d ask me, dollar-cost averaging is quite a no-brainer strategy.

How to make dollar-cost averaging work better

Dollar-cost averaging offers the most benefit when you invest in investments whose prices are highly volatile (move up or down in a big quantum).

An investment that is highly volatile is often perceived as a risky investment. However, this risk plays to your advantage when dollar-cost averaging is applied. How so? The strategy helps to perform an efficient accumulation of investment units. When a particular investment drops significantly in price, you get to accumulate more units. The bigger the drop, the more units you accumulate, thus your accumulation is more efficient (you get to buy the units at a cheaper price).

In comparison, if you invest in an investment that has low volatility, the drop in price would be too small and you can only accumulate a few units, thus rendering your accumulation to be less efficient.

Therefore, when you apply dollar-cost averaging strategy on your unit trust portfolio, go for equity funds. Avoid money market funds or bond funds.

Warning: Don’t apply dollar-cost averaging strategy on a single share. There’s usually an underlying reason why the price of a particular share is in a continuous downward trend. In such circumstances, there’s no assurance that the price will ever go up when the whole market rebound. Worst, the share may not even survive the tough economic crisis and ends up getting delisted.

Do remember that for dollar-cost averaging to work, your chosen investment must be resilient enough to rebound when stock market recovers.

Dollar-cost averaging is best suited if you have a portfolio of equity unit trust funds that is diversified into various regions, so that risks is spread across the share of many companies.

Act on it

To truly benefit from dollar-cost averaging, you have to apply it to your investments. During the implementation process, your resolve would be tested.

There will be times where you will be tempted to abandon the strategy especially when the price of your investment has dropped even further.

Do not waver! Be discipline in executing your strategy and enjoy the gains when the market recovers. Onwards and upwards.

- Yap Ming Hui (ymh@whitman.com.my) is thrilled that his mission to empower every Malaysian with a roadmap to financial freedom has finally come to fruition with the release of a free DIY roadmap to financial freedom tool on the iWealth mobile app. The views expressed here are the writer’s own.

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Washington’s unsustainable deficit hangs over global economy

Tweet #Rightways
 

With the widening US budget gap, it is no longer a secret that such a high level of federal spending is unsustainable and the resulting debt burden has become a worry for the global economy.

According to data from the US Treasury Department, the federal budget deficit went on the rise in 2019, hitting $1.02 trillion and marking the first calendar year the deficit has exceeded $1 trillion since 2012. Given the country's tax revenues, government spending is obviously on an unsustainable path. While total government receipts grew 5 percent in 2019, federal spending increased at a faster pace of 7.5 percent.

More worryingly, as the economy slows amid headwinds, it is basically impossible for the US government to make ends meet by raising tax revenues. So based on the current trend, it will probably become a norm for the annual federal deficit to top $1 trillion in the future.

Undoubtedly, massive fiscal deficits will prompt a steady rise in public debt. According to data released by the Treasury Department on November 1, the US national debt surpassed $23 trillion for the first time in history. The figure is equivalent to about 110 percent of the country's GDP.

Of course, it should be acknowledged that US Treasury bonds are still considered safe-haven assets in the current uncertain global markets as they are seen as secure due to their strong ratings. Treasury securities held by foreign holders amounted to $6.78 trillion as of the end of October 2019, up $580 billion compared with a year earlier, according to Treasury data issued on December 16, 2019.

In the meantime, however, the share of US debt held by foreign holders has fallen from a peak of 34.1 percent in July 2012 to about 29 percent today. The decline also reflects the accelerated expansion of US debt issuance.

So far there is no sign of any sort of sustained plan for narrowing the US deficit to at least rein in its debt expansion. Nor does the government show any sign of urgency on this issue. Maybe the only response from the Trump administration is to pressure the Federal Reserve to cut rates, a move that could help lower its interest payments on debt and devalue its currency to ease the debt burden.

Such surge in irresponsibility could be attributed to two factors - its high creditworthiness and the financial supremacy of the US dollar. Since a collapse of the US economy may cause an economic disaster around the world, the US government could be better off counting on the world to pay the bill.

Sadly, there is no way out under the current circumstances, and the only hope now is that Americans will take some concrete measures to reverse the trend before a debt crisis truly breaks out.

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US gains limited from changed China policy

Tweet #Rightways
 

The year 2019 has been one in which US sought to reconstruct its relations with China.

First, the US reset the premise of its policies toward China. From former president Bill Clinton to Barack Obama, Washington used to consider living with a rising China conditionally as the precondition; but since Donald Trump took office, he has changed the relatively friendly premise into a hostile one. Trying to slow down China's development and preventing the country from surpassing or even replacing the US have become the real intention of his China policy.

Second, the US reframed its relations with China, taking economic and trade ties as the turning point, as well as putting in more efforts in diplomacy, security, politics and culture. The key tools in its reconstruction of economic and trade ties were the war of tariffs, technology and finance.

During 2019, the trade war launched by the US against China saw many ups and downs. The number of products on which the two sides slapped duties reached an unprecedented scale. With the escalating tech war against China, the US Commerce Department added Huawei and 70 affiliates to its "entity list." Besides, China was listed as a currency manipulator by the US Department of Treasury.

Meanwhile, the Trump administration carried out a whole-of-government approach to compete with China and imposed all-round pressure on China.

The US has continued to meddle in Taiwan-related affairs. The Trump administration approved the sale of 66 F-16 fighters to Taiwan in August, the biggest military transaction between the US and Taiwan. Then US National Security Advisor John Bolton's meeting with Taiwan's National Security Council (NSC) head David Lee in the White House in May indicated the upgrade of US-Taiwan relations, which happened for the first time since 1950s.

Most seriously, the US was trying to promote Taiwan's status as a sovereign state. In the Indo-Pacific Strategy Report issued by US Department of Defense, Taiwan was publicly listed as a country; and the Coordination Council for North American Affairs was changed into Taiwan Council for US Affairs.

In 2019, US so-called freedom of navigation operations in the South China Sea were much more aggressive. The China-proposed Belt and Road Initiative (BRI) was also besieged and smeared by the US. The US Indo-Pacific Strategy is meant to counter China's BRI.

Additionally, the US has stepped up competition with China politically and ideologically and kept attacking China's political system.

In terms of the issues of Xinjiang and Hong Kong, US interference was way more blatant than before. The US even passed the Hong Kong Human Rights and Democracy Act, in order to legalize its future interference in the Hong Kong issue. Moreover, the US attacked China's governance in Xinjiang. Not only did the Ministry of Commerce impose export control over 28 Chinese business entities, but the US Department of State also announced visa restrictions against Chinese officials and their relatives. US Congress, furthermore, passed the so-called Uyghur Human Rights Policy Act, keeping up the pressure on China even more.

The series of measures the Trump administration employed to restructure the China-US relationship framework are aggressive.

The Trump administration is trying to change the way China and US interact. It believes that Washington should abandon the engagement policy and cooperation should give way to strategic competition and that the US must pressure China to make concessions. That being the case, the Trump administration has changed the approach of engagement and hedging, reduced engagement and cooperation, and increased confrontation and conflicts with China.

When some hawks within the Trump government talk about China-US competition, what they really want are confrontation and conflict. Many working-level dialogue mechanisms established during the George W. Bush and Obama administrations are no longer in operation. Now Washington resorts to trade, technological and financial wars as well as sanctions. How far can the US go in this way?

First, it depends on how much price the US is willing to pay. Competition, decoupling, confrontation, and non-cooperation all come at a price. The US-launched trade war against China has impacted US agricultural and manufacturing industries and forced consumers to pay more, while the technological war has put the US high-tech industry under risk of losing the Chinese market. Escalating military competition with China means a significant increase in US military expenditure. Restricting China-US people-to-people exchanges will also cause losses to American universities and research institutions.

In fact, with the negative effects of the Trump administration's China policy increasingly becoming apparent, doubts within the US have grown. Although the US elites have generally reached a consensus on a tougher stance against China, they have yet to agree on how much price the US can pay.

Second, China-US relations are the result of bilateral interactions and cannot be unilaterally decided by the US. Facing heightened US pressure, China is exploring more effective ways to respond. Beijing is not afraid of competition.

Finally, the attitudes of the international community and the US allies matter. The China policy and other foreign policies of the Trump administration not only aimed at maximizing US interests, but also have the features of protectionism and unilateralism. The trade war against China has damaged global industrial and value chains, undermining the interests of other countries including US allies.

To sum up, although the US has benefited from its China policy recalibration, its gains are limited. How far will the US move to restructure its relations with China go? It hinges on the changes in US domestic politics as well as China's will and art in wrangling with the US.

By Wu Xinbo Source:Global Times - The author is dean of the Institute of International Studies at Fudan University.


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The development of China's chip industry

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China makes chip breakthroughs in 2019

 China has made up its mind to become self-sufficient in chip technology. Amid a boiling trade war with the US that disrupts the global supply chain, China's chip industry is witnessing a sweeping change, with investment plowing in apace and breakthroughs being made in high-end chips that will significantly reduce reliance on imports.

In the latest move, China's government-funded "starlight chip project" announced on Monday that it plans to invest 10 billion yuan ($1.43 billion) in the next decade on chip technology research, standard-setting study, application development and large-scale industrialization.

Launched in 1999, the project has applied for more than 3,000 patents and formed several chip technological systems including digital media, intelligent security and artificial intelligence.

The project is a vivid example of how investment is shaping China's semiconductor industry this year, in particular after Washington's brutal crackdown on Chinese tech companies like Huawei and ZTE that could potentially cut off key US component supplies.

In October, China set up a second national semiconductor fund of 204.2 billion yuan in a bid to nurture the domestic chip industry, a 47-percent increase of the scale of investment compared with the first fund of 138.7 billion yuan, according to media reports.

"Chinese industry insiders and authorities are giving the biggest-ever incentives to the homegrown chip industry. We all feel a sense of urgency to wean ourselves off foreign technology, spurred by a spiraling trade war," a manager of a Beijing-based chip start-up who spoke on condition of anonymity told the Global Times on Monday.

The whole industrial chain has been shifting its attitude on chips made by Chinese suppliers, according to the manager.

"In the past, downstream vendors tended to prefer foreign chips over homegrown ones. Now, they gravitate toward ours and are willing to help us in accommodating, testing and even in improving functions," he explained.

The industry-wide effort has helped to fuel a boom in the design of advanced computer and smartphone chips. It has also led to a rapid expansion of the market share of homegrown memory chips.

In September, Huawei's HiSilicon unveiled its latest mobile application processor - the Kirin 990. The chipset series is widely believed to be the world's most powerful mobile system-on-chip, with a performance surpassing its foreign competitors such as Qualcomm.

"Huawei's Kirin series represents a major breakthrough in the chip industry. It shows that Chinese players have the ability to design all ranges of chips and their gap with leading foreign players is closing," Xiang Ligang, an expert in the telecoms industry, told the Global Times on Monday. "We just need some time to forge industrial chain ability."

China is on track to achieve its goal of being able to produce 40 percent of the semiconductors it uses by 2020 and 70 percent by 2025. Chinese firms currently supply more than 15 percent of the semiconductors used in the nation, industry insiders estimated.

The nation is also one step closer to producing about 5 percent of the world's memory chips by the end of 2020 from virtually none in 2018, the Nikkei Asian Review reported, quoting sources close to the matter.

But observers admitted that Chinese firms' chip manufacturing abilities are years behind their rivals due to their late start. China's largest chip manufacturer, SMIC, has reportedly begun mass production of chips using its 14-nanometer FinFET manufacturing technology, while top foreign players such as Samsung and Intel already are in a race to supply 7-nanometer chips to the market.

Newspaper headline: China makes chip breakthroughs in 2019

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