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Ant Group, Beijing’s AIGC rules, rare earth, new chip factory, SiC, hydrogen trucks, edible packaging - China Tech Digest #3
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A key question for China’s growth story for the next decade will be how well China’s tech sector, especially the so-called “hard tech” (as opposed to consumer internet), can develop into a globally advanced level. However, a considerable amount of high-quality content in China resides in the Chinese-language world and is neither reported by mainstream Western media nor easily searchable. China Tech News Digest is a curated series that provides the most important trends and updates on China's public companies and industry leaders. We monitor and scan information in these less accessible domains under-reported by mainstream media, but are still worth your attention. This includes millions of articles published by professionals, independent journalists, industry experts, and analysts on platforms such as WeChat official accounts.
Industries covered in this issue
Artificial Intelligence, Neuroscience, Graph Computing: They are trying to spell out the human brain with "pictures"
The article discusses a collaborative project between Ant Group's Ant Technology Research Institute and Fudan University's Institute of Brain Science to develop a new generation of large-scale high-precision brain simulation systems using graph computing. The project aims to deepen understanding of biological intelligence and provide new research methods for brain disease treatment. By combining graph computing and experimental neuroscience, the project seeks to explain the complex workings of the brain using a complex computational model. The significance of this project lies in bridging the gap between computer science and neuroscience, offering a new approach to studying the brain and potentially advancing our understanding of human intelligence and consciousness.
Artificial Intelligence: Training of GPT-like models accelerated by 26.5%, Tsinghua's Zhu Jun and others use INT4 algorithm to speed up neural network training
The article discusses a breakthrough in training neural networks using low-precision algorithms, specifically focusing on the INT4 training algorithm for the popular Transformer neural network. The researchers propose the use of Hadamard quantizers to address the issue of activation outliers, which can lead to a decrease in accuracy. They also leverage the sparsity of gradient matrices during backward propagation to accurately compute matrix multiplications. The proposed algorithm achieves comparable or higher accuracy compared to existing 4-bit training methods and is compatible with contemporary hardware, resulting in a 2.2x speedup and a 35.1% increase in training speed. The algorithm is evaluated on various tasks, including language modeling, machine translation, and image classification, demonstrating its effectiveness and efficiency.
Artificial Intelligence, Beijing issued the "Interim Measures for the Management of Generative Artificial Intelligence Services"
On July 13, the Cyberspace Administration of China（"CAC"）and seven ministries and commissions in China jointly released legal documents on the governance of generative artificial intelligence services.
Set to take effect on August 15th, these are China's first official rules in the field of generative AI. The rules emphasize the importance of producing healthy content that adheres to legal and administrative regulations, as well as respecting social morality and ethical standards. The "interim" rule came after an earlier draft. Compared to the draft used for public comments, the official version has undergone many important changes.
We will publish an in-depth analysis later this week, comparing the nuances between the draft and the final version to answer some important questions, such as whether it means a supportive business environment for the AIGC industry in China or increased censorship. What areas have been strengthened or softened in the final version compared to the draft, and what does it mean for businesses?
Our senior counsel, , specializing in data security and the digital economy, has conducted extensive research on this topic. Stay tuned for the publication of his work later this week, and be sure to subscribe to receive the insightful analysis.
Semiconductor: Downturn in the market, wafer foundries launch price war
Mature process wafer foundries in Taiwan, such as TSMC and UMC, have started a "price war" by significantly reducing their prices in order to attract customers and fill their capacity utilization. The article states that the prices for mature process wafer foundries have dropped by up to 20% for large customers, marking the largest price reduction wave since the pandemic. This development is significant because it reflects the challenging market conditions in the semiconductor industry, with slow recovery and weak demand. The price war is a strategy employed by foundries to maintain their capacity utilization and secure more orders, but it also puts pressure on their revenue and average selling prices.
Chinese semiconductor companies have faced challenges in acquiring overseas companies due to factors such as increased scrutiny from the US and other countries. Several attempted acquisitions have been blocked, including Fairchild Semiconductor in the US and Aixtron in Germany. The tightening of regulations and the growing tensions between China and the US have made it more difficult for Chinese companies to pursue cross-border acquisitions in the semiconductor industry. This has led to a trend of consolidation and integration within the domestic semiconductor industry, as companies seek to optimize resources and achieve economies of scale. Despite the challenges, there are still opportunities for Chinese companies to pursue overseas acquisitions, and efforts in technology innovation, talent development, ecosystem building, policy support, and international cooperation will contribute to the future growth of the domestic semiconductor industry.
Semiconductor: Commencement of Phase II Project of Huahong Wuxi Integrated Circuit Research and Manufacturing Base
The second phase of the Huahong Wuxi Integrated Circuit Research and Manufacturing Base project has started with a total investment of $6.7 billion. This project signifies the deepening of Huahong Semiconductor's dual-engine strategy and the advancement of industrial cooperation between Huahong Group and Wuxi (city in Jiangsu Province). The significance of this breakthrough is that it will provide strong support for enhancing the core competitiveness of the integrated circuit industry in the province and contribute to the development of a high-quality integrated circuit industry ecosystem. Additionally, it will further solidify Huahong's industry-leading position and Wuxi's industrial advantage.
The article discusses the progress and advancements in the domestic silicon carbide (SiC) industry in China. It highlights the successful production capabilities of SiC chips and modules by companies such as Shilan Microelectronics, Sanan Optoelectronics, Taikai Tianrun, and CETC55. These companies have achieved significant milestones in terms of product performance, certifications, and shipments. The article emphasizes the importance of accelerating the development of talent in the third-generation semiconductor industry, as well as the need to increase production capacity and focus on reliability verification for SiC chips, particularly for their application in the electric vehicle market.
Green materials: Chinese scientists create edible food packaging to replace plastic
Chinese scientists at the Chinese University of Hong Kong have developed an edible, transparent, and biodegradable material made from bacterial cellulose (BC) that has the potential to replace single-use plastic packaging. BC is derived from certain types of bacteria and can be produced through microbial fermentation, eliminating the need for harvesting trees or crops. The researchers incorporated soy proteins into the BC structure and coated it with an oil-resistant composite to create an edible and robust BC-based composite packaging. The study showed that the plastic alternative could be completely degraded within one or two months, and it is safe for consumption by sea animals without causing aquatic toxicity. The researchers are now focused on developing a thermosetting glue to increase the versatility of modified BC films and make them more competitive with traditional plastics. This research offers a sustainable and environmentally friendly solution to reduce the excessive use of single-use plastics.
Rare Earth: China's dominance in rare earths: Unshakeable?
China's dominance in the rare earth industry, particularly in the export of rare earth minerals, is a significant concern for other countries. Rare earth minerals are a group of 17 elements that are crucial for various high-tech applications such as electronics, military equipment, wind turbines, and electric vehicles. China currently accounts for over 70% of global rare earth production, followed by the United States, Australia, Myanmar, and Thailand. However, China's rare earth exports have been declining, with a 4.4% decrease in the first five months of 2023 compared to the previous year. The United States, which heavily relies on rare earth imports from China, has been gradually reducing its dependence, from 80% in 2014-2017 to 74% in 2018-2021. Other countries such as Japan have also sought alternative suppliers to reduce their reliance on Chinese rare earths.
Hydrogen: Jinnan Steel Group Holds Ceremony for Delivery of 50 LiuGong Electric Loaders and 100 Hydrogen-powered Heavy Trucks - Langgang Steel Network
Jinnan Steel Group held a ceremony to deliver 50 LiuGong electric loaders and 100 hydrogen-powered heavy trucks, marking their commitment to accelerating energy transformation and promoting green transportation. This event is a concrete action by the group to implement the national "dual carbon" strategy and comprehensive energy revolution reform pilot requirements, as well as a vivid practice to promote green and low-carbon development and help achieve the goal of making Linfen a pilot city for green transportation. The significance of this breakthrough lies in the group's efforts to lead and demonstrate the transition to green transportation, reduce pollution and carbon emissions, and contribute to the improvement of the regional ecological environment.