But on a more mundane front of the battle, China might be gaining an advantage.
Even as U.S. export restrictions have stymied China's progress in advanced chips, Beijing has been aggressively expanding production of more mature, so-called legacy chips. These aren't as sexy as the higher-end onesâsuch as artificial intelligence chips from Nvidiaâbut they are needed for such essentials as automobiles and household appliances. In fact, disrupted supply of these chips caused havoc in the car market during the pandemic.
China spent $41 billion on wafer fabrication equipment in 2024, a 29% year-on-year rise, according to Morgan Stanley. That is roughly 40% of the global total, and compares with $24 billion in 2021.
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