Foxconn Technology Group, a Taiwan-based electronics manufacturer, is planning a $9 billion chip-making plant in China starting in 2020.

The project will see Foxconn move into the semiconductor industry, relieving some of its reliance on manufacturing parts and phones for Apple. As one of Apple’s largest suppliers, Foxconn’s revenue has been put under strain in recent months due to a slowing smartphone market and poor export market due to trade tensions with the US.

The Chinese government is investing heavily in building its semiconductor industry – part of its ‘Made in China 2025’ initative to develop a high tech manufacturingeconomy. Beijing’s investment in Chinese semiconductor production may also be part of efforts to lure businesses away from Taiwan, which dominates the semi-conductor industry, and in doing so detering independence efforts.

However, this is leading to a technology clash with the U.S., which sees China’s shift to a more advanced manufacturing industry as both an economc and security threat – leading to growing tensions between the countries on trade.

Read the full article here.