Huawei Technologies' breakthrough in making an advanced chip underscores China's determination and capacity to fight back against U.S. sanctions, but the efforts are likely very costly and could prompt Washington to tighten curbs, analysts said.

Huawei unexpectedly unveiled the latest Mate 60 Pro smartphone last week during U.S. Commerce Secretary Gina Raimondo's visit to China, as the government readies a new $40 billion investment fund to bolster its developing chip sector.

The Mate 60 Pro is powered by its proprietary chip Kirin 9000s and manufactured by the country's top contract chipmaker SMIC using an advanced 7 nanometer (nm) technology, according to a teardown by Ottawa-headquartered TechInsights.