Foreign firms invited to chip in for 2nd fund
Print Edition
CHINA is looking for billions of dollars in funds to propel its domestic ambitions in chips to cut a heavy reliance on imports, and has invited overseas investors to help it get there.
The Ministry of Industry and Information Technology said yesterday that it welcomed foreign enterprises to invest in its top state-backed semiconductor fund.
China is looking to accelerate plans to develop its domestic semiconductor market amid a fierce trade stand-off with the United States and a recent ban on US sales, including of American chips, to domestic phone maker ZTE Corp.
China’s National Integrated Circuit Investment Fund is now putting together a second fund to support the sector, a MIIT official said.
“We welcome foreign enterprises to participate,” the official said at a press conference in Beijing.
Officials have previously said that the state-backed chip fund is open to investing in foreign semiconductor firms in China, though major projects have so far been local.
The fund raised about 140 billion yuan (US$22.15 billion) previously.
The second fund is expected to hit 200 billion yuan, industry insiders predict.
Government officials were not available to confirm the figure yesterday.
“The IC industry needs global cooperation — all parts are welcomed to take part in the fund,” Chen Yin, MIIT’s chief engineer and spokesperson said during a conference broadcast online.
The fund, commonly referred to as the “Big Fund,” has previously backed major projects including a Tsinghua Unigroup memory chip plant worth US$24 billion that is now under construction in Wuhan, capital of Hubei Province.
The supportive investment policies are designed to cut China’s reliance on foreign semiconductors, which are one of the country’s top imported products by value.
That dependence was highlighted this month after the US banned American firms from selling components, including semiconductors, to ZTE, in a move that analysts said could be potentially fatal for ZTE’s smartphone business.
US firms are estimated to provide 25-30 percent of the components used in ZTE’s equipment.
Though China is the world’s No.1 chip market, the domestic IC industry can only meet 10 percent of local demand.
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