<ul>
<li>US officials say SMIC sent chipmaking tools to Iran’s military</li>
<li>SMIC is heavily sanctioned by US, which alleges it has ties to Chinese military</li>
<li>Supply of chip tech raises questions about Beijing loyalties in Middle East conflict</li>
</ul>
By Steve Holland and Alexandra Alper
WASHINGTON, March 26 (Reuters) - SMIC, China’s largest chipmaker, has sent chipmaking tools to Iran’s military, two senior Trump administration officials said on Thursday, raising questions about Beijing’s stance in the month-old U.S.-Israeli conflict with Iran.
SMIC (0981.HK) , which has been heavily sanctioned by the U.S. government over alleged ties to the Chinese military, began sending the tools to Iran roughly a year ago and “we have no reason to believe that any of this has stopped,” one of the officials said.
The official added that the collaboration “almost certainly included technical training on SMIC’s semiconductor technology.”
The officials spoke on condition of anonymity in order to discuss previously undisclosed U.S. government information. They did not specify whether the tools were of U.S. origin, which would likely make shipment to Iran a violation of U.S. sanctions.
SMIC, the Chinese Embassy in Washington, and a spokesperson for the Iranian mission to the United Nations did not immediately respond to requests for comment.
The Chinese government maintains that it carries out normal commercial trade with Iran. SMIC, which was added to a trade blacklist in 2020 that restricts its access to U.S. exports, has denied allegations that it has ties to the Chinese military-industrial complex.
China has not publicly taken a side in the Middle East conflict. Chinese Foreign ‌Minister Wang Yi this week called on the parties to seize all opportunities to ​start peace talks as soon ​as possible.
The allegations threaten to heighten tensions between Washington and Beijing as the U.S. wages war against Tehran and as it has sought to choke off China’s advanced chip industry.
Reuters reported last month that Iran was close to a deal with China on the purchase of anti-ship cruise missiles, just as the United States deployed a vast naval force near the Iranian coast ahead of strikes on the Islamic Republic.
It was not immediately clear what, if any, role the chipmaking tools have played in Iran’s response to the war, which was launched by the U.S. and Israel on February 28 and has roiled financial markets, triggered a surge in oil prices and fueled global inflation fears.
One of the officials said the tools have been provided to Iran’s “military industrial complex” and could be used for any electronics that require chips.
Washington has sought to curtail China’s ability to make advanced semiconductors through sanctions on SMIC and other Chinese chipmakers, aiming to limit their access to advanced chipmaking equipment from top U.S. suppliers such as Lam Research, KLA and Applied Materials. The Biden administration tightened restrictions on SMIC in 2024 by cutting off its most advanced factory from more U.S. imports after it produced a sophisticated chip for Huawei’s Mate 60 Pro phone, Reuters reported.

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- SMIC, China's largest chipmaker, has reportedly sent chipmaking tools to Iran’s military, raising concerns about Beijing's involvement in the U.S.-Israeli conflict with Iran.  
- The U.S. has imposed heavy sanctions on SMIC, accusing it of military ties and restricting its access to advanced semiconductor technology, while the Chinese government claims it conducts normal trade with Iran.  
- This situation may escalate tensions between Washington and Beijing amidst ongoing military actions, with potential implications for global financial markets and inflation.

Reuters

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EXCLUSIVE-China's top chipmaker has supplied chipmaking tech to Iran military, US officials say