China Will Invest 9.5 Trillion Yuan In Research And Development Of Chips To Fully Develop The Third-generation Semiconductor Industry

- Sep 25, 2020-

China is speeding up the development of "Chinese chips". Bloomberg reported that China is preparing to formulate a comprehensive set of new policies. It will invest 9.5 trillion yuan ($1.4 trillion) to develop its own semiconductor industry by 2025 in response to the Trump administration’s restrictions. The priority of this task is "like making an atomic bomb."

Bloomberg News quoted people familiar with the matter: Chinese senior leaders will meet in October to formulate economic strategies for the next five years, fully develop the third-generation semiconductor industry, and provide support in scientific research, education, and financing. Related measures have been included in the " The Outline of the Fourteenth Five-Year Plan for the National Economic and Social Development of the People’s Republic of China.

The third-generation semiconductor is a chipset made of materials such as silicon carbide (SiC) and gallium nitride (GaN). Compared with the first-generation semiconductor materials, it has the advantages of higher performance and higher power, and is widely used in 5G communications , Military radar and electric vehicles.

Bloomberg reported that: China imports more than US$300 billion of integrated circuits each year, and Chinese semiconductor developers rely on US-made chip design tools and patents, as well as key manufacturing technologies from US allies. However, as U.S.-China relations deteriorate, it has become increasingly difficult for Chinese companies to obtain component and chip manufacturing technology from overseas.

Huawei will not be able to obtain chips from companies such as TSMC from September 15th, thus increasing the urgency for China to create independent alternative products. (Source: RFI)