China
China

China announces $40 billion fund to boost domestic chip industry

What To Know

  • This state-endorsed initiative marks the third installment from the China Integrated Circuit Industry Investment Fund and endeavors to amass a staggering sum of 300 billion yuan, equivalent to $41 billion in international currency.
  • Huawei has forged a strategic alliance with Semiconductor Manufacturing International Corp (SMIC), a distinguished semiconductor manufacturer, to collaboratively engineer the groundbreaking Kirin 9000s chip, as substantiated by an exhaustive analysis conducted by TechInsights, a reputable analytical firm.
  • The unveiling of the Mate 60 Pro and its subsequent validation of exceptional performance stand in stark juxtaposition to the concerted efforts undertaken by the United States, Japan, and the Netherlands to impose constraints on China’s access to and production of semiconductor technology.
  • These restrictions build upon prior measures that specifically targeted Huawei, including the imposition of a ban on licensing agreements for the export of American technological components to the Chinese conglomerate.

The United States has persistently exerted considerable efforts to curtail China’s semiconductor production capabilities. However, the efficacy of these endeavors remains questionable. China has recently unveiled plans to initiate a substantial fund with the aim of fortifying its semiconductor industry, as reported by Reuters.

This state-endorsed initiative marks the third installment from the China Integrated Circuit Industry Investment Fund and endeavors to amass a staggering sum of 300 billion yuan, equivalent to $41 billion in international currency. It is worth noting that the preceding two iterations of this fund successfully garnered 138.7 billion yuan ($19 billion) in 2014 and 200 billion yuan ($27 billion) in 2019, respectively.

Approximately 60 billion yuan ($8 billion) of this substantial financial injection is anticipated to emanate from China’s esteemed finance ministry. While the identities of other contributors remain undisclosed at this juncture, historical supporters have included prominent entities such as China Telecom and the China National Tobacco Corporation.

A predominant portion of the fund’s allocation will be specifically earmarked for the development of cutting-edge apparatuses tailored for chip manufacturing.

This revelation surfaces a mere few days following the official announcement by Huawei, a renowned Chinese electronics conglomerate, of its latest flagship smartphone, the Mate 60 Pro. Remarkably, this device boasts the integration of domestically produced chips.

Huawei has forged a strategic alliance with Semiconductor Manufacturing International Corp (SMIC), a distinguished semiconductor manufacturer, to collaboratively engineer the groundbreaking Kirin 9000s chip, as substantiated by an exhaustive analysis conducted by TechInsights, a reputable analytical firm.

Notably, SMIC’s advanced 7nm technology exhibits the potential to bestow upon the Mate 60 Pro unprecedented download speeds surpassing those attainable by conventional 5G-enabled mobile devices.

The unveiling of the Mate 60 Pro and its subsequent validation of exceptional performance stand in stark juxtaposition to the concerted efforts undertaken by the United States, Japan, and the Netherlands to impose constraints on China’s access to and production of semiconductor technology.

Merely last August, President Biden issued an executive order imposing further restrictions on investments in Chinese enterprises engaged in technologies, particularly semiconductors. These restrictions build upon prior measures that specifically targeted Huawei, including the imposition of a ban on licensing agreements for the export of American technological components to the Chinese conglomerate.