Raimondo says Huawei’s chip breakthrough is years behind US technology

(Bloomberg) — U.S. Commerce Secretary Gina Raimondo said Huawei Technologies Co.’s latest phone shows that China continues to lag behind in cutting-edge chip technology.

In an interview with CBS News’ 60 Minutes, Raimondo downplayed the company’s claims of a breakthrough and said the technology gap showed the Biden administration’s success in imposing export controls on China.

While Raimondo was visiting China in August, Shenzhen-based Huawei unveiled a smartphone powered by an advanced local 7-nanometer chip, technology that is generations ahead of where the United States hoped to stop the China’s progress.

“It’s years behind what we have in the United States,” Raimondo said in the interview that aired Sunday. “We have the most sophisticated semiconductors in the world. This is not the case for China. We have surpassed China in innovation.

Raimondo pledged to take the “strongest possible” measures to protect U.S. national security, and Commerce Undersecretary Alan Estevez said Huawei’s chipmaking partner Semiconductor Manufacturing International Corp., had “potentially” violated American law. The Biden administration is considering blacklisting Chinese companies it suspects of making chips for Huawei.

The global chip race intensified after Russia’s invasion of Ukraine, when the United States and its allies tightened semiconductor export controls to Moscow. Raimondo said the restrictions were effective, citing reports that the Russians were removing semiconductors “from refrigerators and dishwashers” for use in military equipment.

“It is absolutely true that our export controls have harmed their ability to fight the war and made it more difficult,” Raimondo said.

Raimondo’s department — once known for its secretary who struggled to stay awake at work — has played a central role in the Biden administration’s China strategy, including efforts to keep the most advanced technology out of hands Chinese people.

After getting the Netherlands and Japan to adhere to some restrictions last year, then tightening U.S. rules in the fall, Raimondo is pressuring those two countries — as well as South Korea and Germany — to that they further limit China’s access to foreign technologies.

His department is also responsible for providing grants and loans worth more than $100 billion to boost domestic semiconductor manufacturing, while rallying allies to curb China’s chipmaking ambitions and AI.

Raimondo has spent the past few weeks unveiling multibillion-dollar Chips and Science Act 2022 awards for Intel Corp., Taiwan Semiconductor Manufacturing Co. and Samsung Electronics Co., and he’s set to announce another for Micron Technology Inc. this week. Federal funding has spurred more than $200 billion in private investment in semiconductors since President Joe Biden took office, and more than 600 companies have expressed interest in the grants, which are allocated to nearly 85%.

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