China chip industry group says it’ll work with US counterpart

A Chinese semiconductor industry group says it has agreed to work with its U.S. counterpart on chip-related issues, a rare example of bilateral cooperation in an area that has become a focal point of tensions between Washington and Beijing.

The China Semiconductor Industry Association said Thursday in a statement on its website that it will form a working group with Washington, D.C.-based Semiconductor Industry Association. Ten chip companies from each nation will meet twice a year to discuss policies ranging from export curbs to supply-chain safety and encryption technology, the statement said.

Shares of Chinese firms involved in the chip industry advanced after the statement appeared on the CSIA’s website. Semiconductor Manufacturing International Corp. rose as much as 12% in Hong Kong trading. Hua Hong Semiconductor Ltd. and Shanghai Fudan Microelectronics Group Co. surged at least 13% and 14% respectively.

CSIA didn’t immediately respond to a request for comment. The U.S. group, which represents firms like Intel Corp. and Qualcomm Inc., hasn’t posted a statement on its website about any cooperation and didn’t respond to a request for comment sent after business hours.

The future of the semiconductor industry is becoming a major issue in the tense U.S.-China relationship. Premier Li Keqiang vowed in a major speech last week that his country would boost spending and drive research into cutting-edge chips and artificial intelligence as China seeks to cut reliance on U.S. technologies. The Asian nation imports $300 billion of semiconductors annually.

The Trump administration took steps to limit the growth of Chinese national champions such as Huawei Technologies Co. and SMIC, China’s largest chip producer. U.S. President Joe Biden has put technologies such as semiconductors, artificial intelligence and next-generation networks at the core of its policies toward China, and said it will stand up to China and other “techno-autocracies.”

Cooperation between industry groups is badly needed, said Stewart Randall, head of electronics at consultancy Intralink in Shanghai. “It would be a disaster if two semiconductor worlds were created where nothing was inter-operable or there were no standards,” he said.

CSIA was formed by China’s top chip suppliers, labs and investors, including some that are on Washington’s blacklist, according to its website. Its management team is who’s-who of some of the most prominent figures in the country’s semiconductor industry. The association’s head is Zhou Zixue, chairman of Hong Kong-listed SMIC. Xu Zhijun, deputy chairman on Huawei’s board, and Zhao Weiguo, chairman of Tsinghua Unigroup, are board members.