China Launches $47.5 Billion Chip Fund to Support Domestic Domestic Semiconductor Industry

China established a new $47.5 billion semiconductor investment fund to boost the development of its domestic chip industry. The fund, known as Big Fund III — the largest in the country’s history — includes contributions from the central government and major state-owned entities like the Industrial & Commercial Bank of China.

This strategic move by the Chinese government is in response to escalating tensions with the United States, which imposed several restrictions on China’s access to advanced chip-making technology. The U.S. also encouraged its allies to tighten export controls to further restrict China’s semiconductor capabilities.

The launch of Big Fund III is part of a broader effort by China to achieve technological self-sufficiency and reduce dependence on foreign technology. 

This is particularly important as the U.S. and European Union are significantly investing in semiconductor technology, highlighting the global competition for chip supremacy. The Biden administration’s 2022 Chips and Science Act, for instance, allocated billions in support for U.S. chipmakers.

China’s proactive investment in its semiconductor sector includes not just new funding but also an ongoing commitment to supporting major firms like SMIC and Huawei.

For more information, read the full article on Bloomberg.