China, emphasizing technological independence against U.S. high-tech regulations, has rolled up its sleeves to create a fund of at least $27 billion to foster its domestic semiconductor industry. The scale is expected to surpass the 200 billion yuan second fund in 2019, making it the largest ever. Reuters reported in September last year that the Chinese government planned to create a third semiconductor fund of 300 billion yuan. The U.S. government plans to inject a total of $52.7 billion in semiconductor subsidies to attract high-tech semiconductor companies, and it is analyzed that the Chinese government has officially launched a war of money to hold the hegemony in the competition.
According to major foreign media such as Bloomberg News on the 9th (local time), the Chinese government is creating a third fund for the ICF (National Integrated Circuit Industry Investment Fund), a semiconductor industry development fund. It is projected to collect funds from local governments, investment companies, and state-owned companies, and the central government’s direct investment will not be significant. The launch date of the fund is not yet specified.
As the U.S. has restrained China’s advanced semiconductor industry with various regulations and astronomical subsidies, it is analyzed that China has launched a third fund aiming at President Xi Jinping’s New Quality Productive Forces. The Biden administration announced that it is reviewing supplemental sanctions against six Chinese semiconductor companies, including Changxin Memory Technologies (CXMT). This is a subsidiary measure following the regulation of trade with SMIC, China’s largest semiconductor company, last year. In response, China is actively supporting domestic companies such as Huawei and SMIC in self-supplying semiconductor technology and is announcing the creation of the largest fund ever.
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