The United States accuses SMIC, Chinas leading chip manufacturer, of having supplied…

In the midst of the Middle East conflict, the leading Chinese electronic chip manufacturer has reportedly supplied Iran with essential technology for chip production, according to Washington. These chips are crucial for modern drones and missiles.

The Chinese group Semiconductor Manufacturing International Corporation (SMIC), the country’s main chip manufacturer, allegedly provided semiconductor and electronic chip manufacturing equipment to the Iranian military, as stated by senior U.S. officials cited by Reuters.

Previously heavily sanctioned by the United States for its alleged ties to the Chinese military, SMIC is said to have started these deliveries about a year ago, with no signs of interruption.

According to these same sources, this cooperation goes beyond just providing equipment and likely includes technical training in semiconductor technologies. However, officials did not specify if these tools incorporate components or technologies of American origin, which could be a direct violation of current sanctions.

The Chinese government claims to maintain “normal” commercial relations with Iran, while SMIC, blacklisted by the US since 2020, continues to deny any connection with the Chinese military-industrial complex. Beijing has not publicly taken sides in the Middle East conflict, calling for a swift resumption of negotiations through its Foreign Minister Wang Yi, who also denounced “false” news regarding the supply of electronic tools to Iran.

Tensions Rising

But these accusations could reignite tensions between Washington and Beijing, as the United States seeks to contain both Iran and the growing Chinese semiconductor industry. Recently, Reuters reported a possible agreement between Tehran and Beijing for the purchase of anti-ship cruise missiles equipped with modern chips, as the United States strengthened its military presence in the region.

The exact role of these equipment in the conflict remains uncertain. According to Washington, they were provided to the Iranian military-industrial complex and could be used for various electronic applications requiring chips. For years, the United States has been trying to curb China’s capabilities in this area by imposing sanctions on actors like SMIC and limiting their access to advanced technologies from American, or allied, groups like ASML. This strategy was further intensified in 2024 by the Biden administration, especially after SMIC produced an advanced chip for Huawei’s Mate 60 Pro smartphone, despite the existing restrictions.

Chinese Rise to Power

Despite the sanctions, China continues to massively increase its production. In 2025, the company expanded its capacity to 1.06 million wafers per month, which is 111,000 more than a year earlier, while investing 5.52 billion yuan (approximately 779 million dollars), over 8% of its revenue, in research and development.

This surge is part of a broader trend. According to the South China Morning Post, Chinese manufacturers are significantly boosting their capacities to meet the demand for artificial intelligence, by introducing new production lines and expanding existing factories. Data presented at the Semicon China international exhibition in Shanghai suggest that by 2028, China could account for 42% of the global wafer manufacturing capacity for current processes, with 47 out of the 108 planned factories worldwide that year.