Hi there, that is Kenji. I’m penning this week’s e-newsletter from Bangkok, the place I’m attending an annual assembly with colleagues from throughout the area.
I used to be posted right here as an editor a couple of decade in the past, and it’s all the time a pleasure to come back again, however the positioning of Thailand — and the Affiliation of Southeast Asian Nations as an entire — has shifted considerably, particularly since tensions between the US and China began to warmth up round 2018.
Getting caught between nice energy rivals like that is one thing smaller nations search to keep away from, and members of Asean are not any exception. However even when international locations do get drawn into these energy performs, it isn’t all the time in a unfavorable means, resembling Vietnam attracting substantial investments and rising as a significant manufacturing hub of varied tech merchandise throughout this era.
As we function on this version of the e-newsletter, Singapore has loved a pointy stand up the worldwide rating of start-up ecosystems, as funding in so-called deep tech surged towards a backdrop of Sino-American tensions. Cambodia, in the meantime, is turning into a battleground between China and Japan, a key US ally, by way of telecom infrastructure constructing, which might flip right into a optimistic for native customers as elevated competitors brings higher companies at decrease costs.
After all, anybody can discover themselves within the crossfire of the US-China rivalry, as our Taipei colleagues remind us with their scoop this week about Taiwan Semiconductor Manufacturing Co (TSMC) halting shipments to sure prospects to keep away from inadvertently violating US export controls on China.
Irrespective of who’s elected president within the US subsequent week — Kamala Harris or Donald Trump — different international locations will proceed having to navigate the Washington-Beijing rivalry with all its varied penalties.
Elevating the alarm
TSMC, the most important semiconductor producer on this planet, has stopped delivery to at least two chip developers over suspicions they had been making an attempt to bypass US export controls on China’s Huawei Applied sciences, Nikkei Asia’s tech correspondents Cheng Ting-Fang and Lauly Li reported on this unique story from Taipei.
The 2 builders positioned orders for chips made with 7-nanometre course of expertise, which TSMC has been utilizing for mass manufacturing since 2018. Washington has been limiting chipmaking gear containing American expertise from getting used to make chips of 14nm or higher for China with out an export license. TSMC’s most superior industrial merchandise are the 3-nm processor chips used for Apple’s iPhone 16 sequence.
Implementing Washington’s export controls is much from simple, as chip builders might use layers of non-Chinese language shell corporations to camouflage their orders, in response to sources.
TSMC reiterated to Nikkei Asia that it has not equipped Huawei since mid-September 2020 in compliance with the US export restrictions.
Samsung’s struggles
Samsung Electronics is struggling to carry on to its crown because the world’s top-selling smartphone maker, write the Monetary Instances’ Track Jung-a and Christian Davies.
The South Korean tech large was the one one of many prime 5 international smartphone makers to expertise falling shipments within the third quarter of this 12 months, dropping market share to US rival Apple and Chinese language contenders providing slick new foldable units.
Analysis group TechInsights expects Apple’s new generative synthetic intelligence options to assist energy the US firm previous Samsung subsequent 12 months.
Samsung as soon as pioneered foldable units however ceded the highest spot earlier this 12 months to Chinese language rival Huawei, which had a 27.5 per cent share of the foldables market within the second quarter, in contrast with Samsung’s 16.4 per cent, in response to IDC.
The corporate’s smartphone struggles come at a crucial level. It has been hit by a sequence of failures at its semiconductor division, which accounts for 60 per cent of Samsung’s working revenue.
Deep pockets for deep tech
“Deep tech” endeavours in Singapore are getting a boost amid the ever-intensifying Sino-American tech tensions. Nikkei Asia’s Tsubasa Suruga experiences that funding on this subject — which relies on scientific analysis with doubtlessly massive social impacts like chips, robotics and drugs — was up 31 per cent by quantity final 12 months, at the same time as total start-up funding dropped 20 per cent.
Primarily based on knowledge by DealStreetAsia and Enterprise Singapore, deep tech accounted for 25 per cent of the entire deal worth, up from 17 per cent in 2022.
The enhance in deep tech funding helped push the city-state’s international start-up ecosystem rating to seventh this 12 months, up from 18th simply two years in the past, and leapfrogging all different Asian hubs, together with Beijing, Seoul and Tokyo, in response to US-based analysis firm Startup Genome.
Traders — who’re largely native or American, but in addition from Taiwan, Japan, France and Malaysia — say deep tech tends to stay underneath the radar as a result of complicated expertise and experience concerned, however it’s gaining significance amid the US-China commerce warfare and provide chain shifts.
New connections
A Japanese tech consortium, with assist from authorities subsidies, is challenging the Chinese dominance within the 5G market. The preliminary battleground is Cambodia, an ostensibly impartial nation that has proven itself to be a staunch ally to Beijing, in response to an unique report by Nikkei’s Kiu Sugano, Shiho Miyajima and Kyoko Hariya.
Orex Sai, a three way partnership between NTT DoCoMo and NEC, will construct a 4G community at a big industrial complicated within the Southeast Asian nation by March, which can function a platform for transitioning to 5G sooner or later.
Cambodia’s telecom community, like many world wide, is reliant on gear from Huawei Applied sciences. The Chinese language firm and its compatriot ZTE collectively management greater than 40 per cent of the worldwide marketplace for 5G base stations, British analysis firm Omdia says. Japanese gamers as an entire maintain about 3 per cent.
For this Cambodia undertaking, Tokyo is making use of a brand new support coverage that applies authorities help proactively quite than ready for a request from a recipient nation. The event co-operation constitution revised final 12 months, which stresses Japanese support cash “doesn’t contain debt traps or financial coercion, and that doesn’t undermine the independence and sustainability of creating international locations”, may even be utilized to the undertaking.
Urged reads
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Chinese EV battery maker SVOLT to shut European operations (Nikkei Asia)
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Vingroup jumps into start-up investing with $150mn Vietnam fund (Nikkei Asia)
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Lex: Indonesia’s iPhone 16 ban will hurt consumers more than Apple (FT)
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New boss seeks to bring Naspers out of Tencent’s shadow (FT)
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Australia looks to mining waste for cutting-edge chip materials (Nikkei Asia)
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FBI investigates claims China tried to hack Donald Trump’s phone (FT)
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‘AI will acquire a human form,’ top Nvidia executive tells Nikkei forum (Nikkei Asia)
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Toyota and NTT to team on AI self-driving to prevent crashes (Nikkei Asia)
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Head of Australia’s largest listed tech group quits after reports on private life (FT)
