China to put even more money into semiconductors

A more than US$40 billion boost for China’s semiconductor sector could be on the way, as reports – officially unconfirmed but widely reported – suggest a new state-backed investment fund for the sector is to be launched by the country.

This isn’t China’s only semiconductor funding initiative. However, if the US$41 billion target is reached (with China's finance ministry apparently contributing some US$8 billion), it will be the biggest by some margin of three funds launched by the China Integrated Circuit Industry Investment Fund.

This fund aims to help China reach its national goal of achieving self-sufficiency in the semiconductor industry (as part of the Made in China 2025 plan) by investing in domestic semiconductor companies. Reuters cites sources that indicate that a main area of investment for the new fund will be equipment for chip manufacturing.

As the news service points out, domestic investment in this area is becoming more urgent, not least because of US export control measures that have, among other things, limited China's access to advanced chipmaking equipment.

That said, the fundraising process could take months – and it’s not clear when the third fund will be launched or what form it will take.

The China Integrated Circuit Industry Investment Fund, aka the Big Fund, has already provided financing to China's two biggest chip foundries, as well as to Yangtze Memory Technologies, a maker of flash memory, and a number of smaller companies and funds.

However, Reuters says, despite those investments, China's chip industry has struggled to play a leading role in the global supply chain, especially for advanced chips.

Sign-up to our weekly newsletter

Keep up-to-date with all the latest news, articles, event and product updates posted on Developing Telecoms.
Subscribe to our FREE weekly email newsletters for the latest telecom info in developing and emerging markets globally.
Sending occasional e-mail from 3rd parties about industry white papers, online and live events relevant to subscribers helps us fund this website and free weekly newsletter. We never sell your personal data. Click here to view our privacy policy.