US export restrictions strengthen China’s resolve for innovation

US  claws at China's chip industry fanning flames on tech confrontation. Cartoon: Carlos Latuff

Despite the challenges posed by the US-led technological blockade and various forms of international pressure, confidence in China's semiconductor industry has markedly strengthened, driven by encouraging developments and substantial policy support.

The CSI Semiconductor Index surged to a gain of 6.84 percent on Monday, touching the highest level since December 2021, while the CSI Integrated Circuits Index's gain stood at one point at 5.44 percent on Monday.

The significant gains on Monday came right after the news over the weekend that the US Department of Commerce had sent a letter to TSMC imposing export restrictions on certain sophisticated chips - of 7-nanometer or more advanced designs - destined for Chinese mainland customers, the South China Morning Post reported. 

Surprisingly, the market's initial reaction far exceeded many analysts' expectations. Rather than exhibiting panic, investors responded with optimism, believing that this external pressure would serve as a catalyst for accelerating self-reliance and fostering independent innovation among Chinese mainland companies in the semiconductor sector. 

This positive market response reflects an affirmation of the progress made by China's semiconductor industry and also underscores the high expectations surrounding its potential for development across various dimensions, including but not limited to technological innovation as well as the optimization and upgrading of the industrial supply chain.

In recent years, the US has continuously stepped up export controls on advanced technology and relevant products to China, presenting significant challenges for the Chinese semiconductor industry. 

However, it is precisely in facing such adversity that Chinese semiconductor companies have demonstrated remarkable resilience and self-development capabilities. In the face of external pressures, the self-sufficiency rate of China's semiconductor industry has been steadily increasing. 

If anything, this trend indicates that China's position in the global semiconductor industry is gradually improving and reflects the acceleration of China's independent innovation and localization processes in the semiconductor field.

As the global semiconductor market is projected to exceed $1 trillion by 2030, the growth potential in the Chinese market is significant and cannot be ignored, offering substantial opportunities for independent innovation in China's semiconductor industry. 

While ramping up research and development (R&D) efforts and promoting domestic production, China's semiconductor industry is also accelerating its procurement of semiconductor equipment. According to the latest data from SEMI, China's spending on chip manufacturing equipment reached a record-breaking $25 billion in the first half of 2024, surpassing that of countries such as the US and South Korea. 

Amid a global economic slowdown, China is the only country where spending on chip manufacturing equipment continued to increase year-on-year in the first half of this year. The figures underscore the determination of the Chinese semiconductor industry to enhance its production capacity and technology.

While Chinese semiconductor companies have made notable strides in the low- to mid-end market, it is essential to acknowledge that significant challenges remain for breakthroughs in semiconductor technology. The heightened US export controls, although strengthening China's resolve to carry out independent innovation in the short term, present a substantial long-term challenge for the Chinese semiconductor industry - that is, achieving advancements in high-end technology.

For example, there remains a significant gap between China's technological capabilities and the world's most advanced lithography equipment. If breakthroughs in core semiconductor technologies, such as domestically produced lithography machines, do not materialize as anticipated, it could negatively affect the capacity expansion and production plans of domestic chip manufacturers.

The journey for Chinese semiconductor companies in the high-end sector remains long and arduous. On the one hand, there is a need to continue increasing R&D investment, focusing on breakthroughs in core technologies and enhancing self-controllable capabilities. This requires not only the efforts of the companies themselves but also support from the government, universities and research institutions. On the other hand, it is also necessary to strengthen international cooperation, participating in the development of the global semiconductor industry chain.

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Govt intervention won’t fix housing prices

 

■ Every adult should sensibly secure a home as everyone needs a roof over their head ■ Residential properties in prime locations undergoing ‘shrinkflation’, with sustained higher prices despite new units getting smaller

Greyscale low angle view of a highrise building with glass windows under sunlight

THE indirect discussion on multiple-home ownership between Housing and Local Government Minister Nga Kor Ming and former Cabinet member Khairy Jamaluddin over various media channels has ignited interest among Malaysians.

The latter wondered on his podcast Keluar Sekejap last week if limiting property purchases could help alleviate the crisis in affordable housing by addressing the surplus of unsold high-end homes that contribute to inflated prices.

Nga countered by dismissing the proposal, arguing it is not the government’s role to restrict investments in the real estate sector, which has proven to be an effective hedge against inflation and a means of wealth preservation.

He cautioned that such restrictions could harm the property sector and negatively impact some 200 industries connected to real estate, including contracting, plumbing, banking and legal services.

From a foreign perspective, if one were to speak to ordinary Hong Kong residents, it would come as no surprise to find that opinions are mixed on tycoon Li Ka-shing, the billionaire founder of CK Hutchison Holdings Ltd.

Although Li – whose name is synonymous with wealth in the former British colony – is a highly regarded businessperson, many in Hong Kong put the blame for the city’s exorbitant property prices on ultra-rich individuals like him, who made their fortunes by flipping properties in the densely populated region.

In fact, there is a local saying that goes:

“The houses in Hong

Kong are not meant to be inhabited.

They are meant to be ‘fried’ (slang for flipping at a higher price in Cantonese).”

This, of course, is in addition to the fact that most

Hong Kong residents live in high-rise units that can feel claustrophobic.

This may explain why many of them enjoy being out on the streets as long as possible, even into the early hours of the morning.

Back home, if one were to drive around our own cities of Kuala Lumpur, Petaling Jaya, Georgetown and Johor Baru, one can’t help but notice the significant number of high-rise residential buildings under construction.

This prompts one to ask a pressing question: Who is actually buying these units?

In addition, it is reasonable to wonder if property investment is truly so lucrative, what will happen to the prices of these high-rise accommodations in the future, especially in view of the government’s goal to encourage homeownership among the youth?

In fact, just a couple of months ago, before Khairy’s comments on his podcast, this writer – who has never advocated for socialist practices in any way – had wondered out loud to his spouse whether the government might need to step in and limit the “frying” of residential property prices.

So, is Malaysia heading in the same direction as Hong Kong?

At first glance, maybe not, but a deeper look may reveal a different story.

Reports in The Star earlier this week indicated that Malaysian residential properties in prime locations are undergoing “shrinkflation”, characterised by a sustained increase in property prices even though new units are getting smaller.

This trend places a heavier burden on buyers, especially on young Malaysians intending to buy their first home.

However, property prices and social responsibilities aside, it is easy to understand why investing in real estate is so attractive: for one, it is more tangible than stocks, bonds or mutual funds, and the thrill of monthly rental collection appeals to those seeking regular returns.

On the other hand, equities and bonds are much easier to liquidate, and there is significantly less legwork involved as members of the public do not normally run the companies whose shares they own, as opposed to property owners who bear the cost of maintaining their assets.

Furthermore, for those interested in steady income, there are blue-chip banking stocks that offer healthy dividend yields, often with lower upfront costs compared to real estate.

Seasoned investor Ian Yoong, whose portfolio regularly achieves a compounded annual growth rate of 23%, believes that Malaysian property prices have increased at a healthy rate over the past few decades.

He points out that restricting residential-property ownership could suppress prices, ultimately discouraging investment in the sector.

“Malaysia’s property market overhang improved slightly in the first half of 2024 (1H24) compared with 2H23, with the total number of unsold units falling by 12.3% and their aggregate value declining by 19.5%.

“The current property overhang itself will cap the rise of residential property prices over the next couple of years.

“The government should therefore not impose any limits on home ownership,” he tells Starbiz 7.

Yoong emphasises that the current property overhang will naturally limit the rise of residential property prices in the coming years.

He advises the government to refrain from imposing any restrictions on homeownership, as doing so could hinder market growth.

A cursory check supports Yoong’s claim, revealing that high-rise residential property prices in many areas of Kuala Lumpur and Petaling Jaya have stagnated compared with 15 to 20 years ago, when the property market was experiencing a boom.

This is despite the completion of both Mass Rapid Transit (MRT) lines 1 and 2 in recent years, which many investors felt could have improved prices, particularly in neighbourhoods near the MRT stations.

While it is understandable that Yoong would prefer to invest in equities given his success and the comparatively less field work, he strongly advises every Malaysian adult to obtain a home.

“Save for a down payment and apply for a bank loan to buy a residential property that is within your means. It matters little whether it is a lowcost flat or a terrace house.

“While this might not be the best investment strategy, it is a sensible move. Every adult needs a roof over their head,” he says.

Yoong says that the monthly loan repayment acts as a form of forced savings.

He stressed that in reality, not everyone is meant to be a successful investor, but almost everyone can be a property owner.

“Once home ownership is out of the way, one can then focus on investing surplus funds in shares, properties, cryptocurrencies and the like,” he advises.

KEITH HIEW keith.hsk@thestar.com.my

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IGP slams dirty cops

 

Razarudin: Level of integrity and standard compliance still worrying

PETALING JAYA: The Inspector-General of Police (IGP) has publicly lambasted bad apples in the police force who have tainted its image by working with criminals and breaking the law themselves.

Tan Sri Razarudin Husain, in a strongly worded speech at a monthly assembly at Bukit Aman yesterday, said statistics up until September have already shown an increase in police officers caught as suspects in commercial crime cases when compared to the whole of last year.

“I have been informed that in 2023 there have been as many as 22 police officers who were caught as suspects related to commercial crime cases. Even more worrying is the increase in police officers’ involvement in commercial crimes to 23 people from January to September 2024.

“I am very much disappointed and hurt when the trust bestowed onto this uniform that we are proud of has been abused by those who I would describe without exaggeration as selfish and dishonourable,” he said.

Despite numerous warnings from him, he said the level of standard compliance is still at a worrying rate.

“The image and prestige of PDRM is tainted with the arrests of a handful of members of the police force over criminal offences, drugs, corruption and abuse of power

“I often stress the need for a drastic change in the work culture and level of integrity within each member of the police force so that it will remain relevant and respected by the public.

“However despite many repeated reminders and warnings, the level of integrity and compliance of standards within the force is still at a worrying level,” he said.

On current commercial crime statistics, the IGP said that there had been a decrease in cases in the same time frame this year as compared to 2023, with a reduction of 1,412 cases.

Between January and September, the department had recorded 29,010 cases, with losses estimated at RM1.98bil. The losses are an increase of 22.6% when compared to the whole of 2023.

“Online scam cases involving the six main modus operandi – telecommunication, e-finance, e-commerce, love scams, non-existing loans and fake investments – make up the majority of cases reported each year.

“For 2024 up until September there have been 24,671 cases recorded with losses estimated at RM1.04bil,” he said.

In terms of enforcement action, the CCID had launched 17,661 raids and operations leading to the arrest of 18,506 people.

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Rise of the Global South will change the world

 

Egyptian Foreign Minister Badr Abdelatty. — AFP

"We face serious and existential challenges at regional and international levels, a matter that necessitates consensus among major countries. We count on this economic bloc (BRICS) to be a voice for the Global South and developing countries," said Egyptian Foreign Minister Badr Abdelatty in an interview with Russia Today.

The collective rise of the Global South is a distinctive feature of the great transformation across the world. Today the Global South represents over 70 percent of the world's population and more than 40 percent of the world's Gross Domestic Product. But they are relatively under-represented on the world stage. BRICS, which recently held its 16th Summit in Kazan, Russia from Oct 22 to 24, stands at the forefront of the Global South focusing on pooling collective wisdom to open up new prospects for development and prosperity for all developing countries.

At the summit, China called on BRICS to uphold peace, strive for common security and common prosperity and promote the flourishing of all civilizations. These proposals respond to the Global South's urgent need for peace, development and cooperation, and are consistent with China's Global Development Initiative, the Global Security Initiative and the Global Civilization Initiative.

China will always be a member of the Global South. Solidarity and cooperation with fellow developing countries is the unshakable foundation of China's foreign relations. China believes that global modernization should be pursued through the joint efforts of all countries, in a way that promotes peaceful development and mutually beneficial cooperation bringing prosperity to all. This goal is consistent with China's vision of building a community with a shared future for mankind.

China's announcement is matched with concrete actions and tangible outcomes. Over the years China has provided development assistance to over 160 countries, conducted development cooperation with more than 150 countries involved in the Belt and Road Initiative, energized cooperation with more than 100 countries, the UN and many other international organizations under the Global Development Initiative, provided nearly US$20 billion of development funds and carried out over 1,100 projects. China's steady contribution to the development of the Global South has empowered the construction of an equal and orderly multipolar world.

Through the concerted efforts of China, Brazil, Russia, India and South Africa, BRICS countries have successfully expanded their ranks by welcoming new members. This year's summit marks the start of the "Greater BRICS Cooperation". China also proposed the "BRICS Plus" cooperation model. During the Kazan Summit, more than 20 leaders or representatives of invited guest countries from Asia, Africa, Europe and Latin America and heads of six international organizations attended the "BRICS Plus" Leaders' Dialogue. The BRICS mechanism is now widely regarded as an inclusive platform for development and growth. It is fundamentally different from the closed-door clubs run by some countries bearing all the marks of rigid Cold War mentalities and bloc confrontation.

China made this commitment at the summit that it will always keep the Global South in its heart, and maintain its roots in the Global South. When members of the Global South pull together, great power will be unleashed for their own people's well-being and for all humanity living in our community with a shared future. — China Daily/ANN

By Zhu Qing , The author is a commentator on international affairs. The views don't necessarily represent those of China Daily.

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Rise of the Global South will change the world

 

Egyptian Foreign Minister Badr Abdelatty. — AFP

"We face serious and existential challenges at regional and international levels, a matter that necessitates consensus among major countries. We count on this economic bloc (BRICS) to be a voice for the Global South and developing countries," said Egyptian Foreign Minister Badr Abdelatty in an interview with Russia Today.

The collective rise of the Global South is a distinctive feature of the great transformation across the world. Today the Global South represents over 70 percent of the world's population and more than 40 percent of the world's Gross Domestic Product. But they are relatively under-represented on the world stage. BRICS, which recently held its 16th Summit in Kazan, Russia from Oct 22 to 24, stands at the forefront of the Global South focusing on pooling collective wisdom to open up new prospects for development and prosperity for all developing countries.

At the summit, China called on BRICS to uphold peace, strive for common security and common prosperity and promote the flourishing of all civilizations. These proposals respond to the Global South's urgent need for peace, development and cooperation, and are consistent with China's Global Development Initiative, the Global Security Initiative and the Global Civilization Initiative.

China will always be a member of the Global South. Solidarity and cooperation with fellow developing countries is the unshakable foundation of China's foreign relations. China believes that global modernization should be pursued through the joint efforts of all countries, in a way that promotes peaceful development and mutually beneficial cooperation bringing prosperity to all. This goal is consistent with China's vision of building a community with a shared future for mankind.

China's announcement is matched with concrete actions and tangible outcomes. Over the years China has provided development assistance to over 160 countries, conducted development cooperation with more than 150 countries involved in the Belt and Road Initiative, energized cooperation with more than 100 countries, the UN and many other international organizations under the Global Development Initiative, provided nearly US$20 billion of development funds and carried out over 1,100 projects. China's steady contribution to the development of the Global South has empowered the construction of an equal and orderly multipolar world.

Through the concerted efforts of China, Brazil, Russia, India and South Africa, BRICS countries have successfully expanded their ranks by welcoming new members. This year's summit marks the start of the "Greater BRICS Cooperation". China also proposed the "BRICS Plus" cooperation model. During the Kazan Summit, more than 20 leaders or representatives of invited guest countries from Asia, Africa, Europe and Latin America and heads of six international organizations attended the "BRICS Plus" Leaders' Dialogue. The BRICS mechanism is now widely regarded as an inclusive platform for development and growth. It is fundamentally different from the closed-door clubs run by some countries bearing all the marks of rigid Cold War mentalities and bloc confrontation.

China made this commitment at the summit that it will always keep the Global South in its heart, and maintain its roots in the Global South. When members of the Global South pull together, great power will be unleashed for their own people's well-being and for all humanity living in our community with a shared future. — China Daily/ANN

By Zhu Qing , The author is a commentator on international affairs. The views don't necessarily represent those of China Daily.

Source link

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Emerging economies having bigger say in global affairs inevitable; G7 resurrection notion stupid: father of BRICS

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