Bear Denial
Yesterday we made a reference to Yangtze Memory Technologies’ (600345.CH) effort to identify and replace foreign components to reduce its dependence on off-Mainland sources. While the company is publicly denying that it has set up a special task force to replace US suppliers and is committed to becoming part of the global semiconductor value chain, the response to US sanctions against Huawei (pvt) and other Chinese companies alleged to be associated with the Chinese military has been both obvious and well-documented. The use of EDA software developed in the US is widespread in China and is a source of concern for Chinese design companies, as are parts sourced in the US or produced with US tools, and while a public exhortation of plans to reduce dependence of US based semiconductor tools, components, or software only serves to incite additional ire in the US, you don’t need a weatherman to know which way the wind blows (“Subterranean Homesick Blues” – Bob Dylan – 1965 https://open.spotify.com/album/1lPoRKSgZHQAYXxzBsOQ7v?highlight=spotify:track:6k9DUKMJpWvu6eFG3O64Lg).
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