In 2015, an obscure company run by a real estate mogul woke the world to China’s ambitions in semiconductors, the foundational technology that powers computing. Six years on, China’s would-be microchip champion looks more like a national disappointment. The company, Tsinghua Unigroup, said this month that one of its creditors had initiated bankruptcy proceedings, raising the prospect that it could be broken up. Once an exemplar of the powers of state-directed capitalism, Tsinghua Unigroup is emerging as a cautionary tale about the waste that can come with misplaced investment and subsidies. Over the past two years, market incentives like the subsidies that bloated Unigroup’s books have fed a boom in all things microchip.

Source: New York Times July 19, 2021 03:56 UTC