China: 40-Billion Semiconductor Fund

Amid the “chip war” between China and the USA, Beijing is renewing a 300-billion-yuan (about $40 billion) investment fund to support the national semiconductor industry.

The news was released by Reuters explaining that the goal is to make China more technologically independent in chip manufacturing. The China Integrated Circuit Industry Investment Fund has already set up two funds in the past, in 2014 and 2019, but this one will be the most important, and the list of lenders will include the Ministry of the Treasury with 60 billion yuan.

This will be one of Beijing’s countermeasures after the sanctions and export restrictions imposed by the United States since the end of 2022 and aimed at reducing the supply of high-tech equipment for printing and manufacturing chips. The sanctions were also supported by two other major players in the sector: Japan and the Netherlands. President Xi Jinping’s goal is technological self-sufficiency in an increasingly important sector of the economy.