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China Sets Out $29 Billion Fund For Microprocessors’ War With United States

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China Sets Out $29 Billion Fund For Microprocessors' War With United States

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On October 31st, China introduced a $29 billion state-backed fund to build up its domestic semiconductor industry and stop relying heavily on US producers.

China is the world’s biggest chip importer, and the long-awaited 204 billion yuan ($28.9 billion) fund will fuel Beijing’s efforts to develop its own semiconductor supply chain from chip design to manufacturing.

Beijing’s effort to reduce its reliance on US chips is becoming more urgent as the Trump administration adds more Chinese companies to its export blacklist, prohibiting chip sales to companies such as tech giant Huawei.

Twenty-seven organizations participated in the second financing round of the China National Integrated Circuit Industry Investment Fund, with China’s Ministry of Finance the largest shareholder after a RMB 22.5 billion investment, according to corporate intelligence information platform Tianyancha.

Other backers of the fund include China Development Bank Capital, state-owned firms such as China National Tobacco and the country’s three major telecom operators, local government-supported enterprises.

China imports approximately $200 billion in chips each year, it imports 95% of its high-end chips and several US companies, specifically Qualcomm and Broadcom owe a significant share of their sales to China.

China Sets Out $29 Billion Fund For Microprocessors' War With United States

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Intel, Qualcomm, and Micron, make up 30% of the global chip market and many derive large parts of their revenue from China as can be seen on the graph. The fund impacts chip exporters such as South Korea and Japan, but none more than the U.S. American companies.

This doesn’t mean that a shift would take place immediately, it would likely take years for a Chinese company to compete with the US competitors, but it is not impossible.

Mobile phone companies like Huawei, Oppo and Xiaomi have grown in popularity in the West – with Huawei becoming one of the most popular Android phone manufacturers.

Even without the Trump administration’s pressure, China is aggressively chasing higher domestic chip production under its “Made in China 2025” project.

This investment fund is not the first one, in 2018 there were reports of another fund of $47 billion, but whether it actually launched or not remained unclear.

The Wall Street Journal, citing unnamed sources, reported that the government-backed China Integrated Circuit Industry Investment Fund would allocate the funding to — among other things — improving China’s ability to design and manufacture advanced processors and GPUs.

It is also wholly possible that the $29 billion fund is the one named in the WSJ report, just after a delay, due to one reason or another. Since a $47 billion investment fund would be difficult to pass under the radar.

The first such fund aimed at enhancing China’s production of chips was launched in 2014 and it was worth $21.8 billion and was largely funded by central and local government-backed enterprises and industry players.

China’s State Council, the country’s cabinet, published the “National Integrated Circuit Industry Development Guidelines” in June 2014, which initially proposed setting up a special national industry investment fund to boost the semiconductor industry. The guidelines pledged to stimulate dynamism and creativity in China’s semiconductor companies and accelerate the pace of China’s semiconductor industry in order to catch up with international leaders.

China urgently trying to stop relying heavily on the US is quite showing on the progress of a conclusion of the Washington-Beijing trade war, and it means that the “first phase deal” is nothing conclusive. Regardless, China is following its “Made in China 2025” plan, but it may simply be ramping up efforts to fit into an accelerated schedule.

Huawei is still blacklisted, despite some waivers being given out to some US producers and the “first phase deal” did very little to address any of the actual issues of the trade dispute.

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Simon Bernstein

HA! the fastest most innovative and technologically advanced processors are made in AMERICA + ISRAEL and ALWAYS will be. russkies and chinese still using microprocessors from the 1980s and 90s

Saso Mange

Israel? If JP Morgan buys off patents that doesn’t mean that he made them. Just like Edison, made fortune by stealing from engineers.

USA is technological giant but Israel, it’s just tumor which the USA can’t get rid off. There is nothing 100% made in Israel FYI, from military to space and medical industry, everything is rip off of other nation technology.

Saso Mange

I mean, ffs, Israel was proclaimed in 1947 it doesn’t have longevity, just imports. Common sense man.

Jens Holm

They are no “just” having no where to go and mcuh more advanced then any neighbor.

Saso Mange

Egypt have 10X stronger army and 3X more people. How can you compare tiny nation with giants ffs. Get real.

Jens Holm

Thats normal procedure for anything else. If You take Youtube and articles about fx military forces, they use strenght and not tons of meat.

Other things are important too like friends even they have another agenda as well as being clever in plans and supply lines. Most people agree in, that Assad hardly was Emir of Latakia if they were not helped by Russia, Iran and Hesbollah.

But those people and (off course me included) all are stupidists compared to You.

I can only see You not even today are able to analyse 1973, 1967 and before that. Here You even had strong friends in numbers and equipment, so why did You loose ?

Arrrh I forgot. Your were bought by USA. Being bought seemes to be an option for winning and loosing as well.

Saso Mange

Egypt is 10X stronger meat or no meat. It’s the narrative and media support which makes people speak of Israel. Without that no one would be bothering with those colonial bastards.

Jens Holm
Saso Mange

I do not need link for common sense.

<>

Who are you to call Israel a tumor? you son of a beetch. The only tumor is in your F head, you l0w-life.

Saso Mange

Thanks for proving my point.

Jacob Wohl's Nose

fully intact Patriot-PAC 3 and David’s Sling missiles captured by SAA have been handed over to Russia for research and reverse engineering :) How does that feel Rocket Nose Lover

Jens Holm

That of corse is how things are made. Know Your enemy and improve Yourself.

<>

They can’t do sheet with 1 missile, and it shows how weak they are that they need us to shoot in order to steal our technology.

Jens Holm

Whatever. Israel are doing very good chips and has not patent in being copist if and when they do.

Much like You have a brain tumor Yourself. This is about production of vital things and Israel do it too.

The same goes for the rest of Your comming out from You behind incl. dirty air.

Facts are Your computer or IPad reading here in any version is made by many, many countries. Thats how modern ecomics are and Wester ecomins certainly is.

We take good things and spread them out, copuy tem, innovate them, so right now You use Internet made by CIA blaming USA and Israel.

Saso Mange

I prefer Nikola Tesla over corporate thieves. Elon Musk didn’t name his company by Edison’s name for example.

Prince Teutonic

Classic microprocessors are at the end of their life time. Look at Intel still can’t make huge batches of their 10-nm process. The next step in evolution is quantum processing so Chinks and Russkies can close the gap easier…

Jens Holm

Innovasion is like that, but I dont see Your pattern as You.

We all will buy the new stuff and fx the Chinese as The Russians will not prosuce it for own purpose only.

Thats how it is now and with most new and old stuff.

Denmark invented the Vindmill industry. That has spread all over the world and in many big and very innovative productive scenaries. Those producers now are specialized for many purposes and most of them has great succes replacing wood, coal, oil and gas very well.

It doesnt say Denmark or the 2 big danish companies and their many under suppliers collapse. All are doing fine and as in the rest of the world parts of the old electricity and heat and cooling industry dont lose down. When they renew they step by step replace.

By that its a win win, where we gets cleaner air and it even make plus for the price of electricity, heat and cooling.

I see the same for the future for chips and next generation. We have good hopes for the quantum computers, but we have to see if the implementatios works well or are usefull all over and implemented with the rest.

I dint think we as countries has to back on horses or walk, just because Teslas and others are not perfect. We soon might not even need cars ilke that. May also work hard to make hydrogen to fuel by electric windpower – as an example by many.

Jens Holm

Yes- Understandable others would be as them or better.

Prince Teutonic

With that fund they can attract engineers from entire globe to work on their mic project. I bet even some americans will work for chinks…

Jens Holm

Innovation and Synergy is like that. If You focus and put a lot of money and trust in, You can do that and fx also react the moon for hardly any real purpose.

An interesting part of that is, that those projekts often make new products we never had before.

hvaiallverden

The sole reason for this moronic drooling about the Joohos been the eh…… tech hub, is not because of been inovative etc at all, its because the Jews whom own this corps, and the Monronikan Banking ind. have moved what once where American to the terror state ISISrael, and now, because of that, by reasons witch is solelly due to making the banana republic loose jobs etc is also done by Moronikan traitores, whom have been shipping the jobs inside the banana republic out for decades and now, the Joohos brags about what they never have been nor ever will be, inovative, apart from stealing, and counterfeighting everything, they are just scums, and thats it.
That is have some few shit dont impresses me at all.

Ouantum Comp, well, I am not that extatic, its more an sale pitch than reality, and despite the hype, not usable nor able to be implimcated for an long time, and the Moores Law stil is the rule, and I am not impressed so far, sorry.
I can tell you this, the day we can, or somebody else can, replicate photosyntesis, where they can make enery straight out of the sun, coonvert it to energy and move it to where they are neded by warping space, and time, like an any ordinary house plant can, then shitheads I will be impressed, because the just to give you an ex. where the solar panel to day is just ass hair above the crap line, and havent moved as far I know the last decade, the efficiency rate sucks, etc.
I also know a little bit more about what the Chines are and have done, but dont bother to tell you that this time, they are way ahead of you, Moronikans.

But manufacturing is something else and requires equimpments, and knowhow, and I have worked in tech ind. not as an programer, etc but producing the shit.

This move, is probably the smartest the Chines have done in an while, never forget this China, as the Russian embargos, take it as an gift from heaven, since this forces you to start using your own resources much better, and pay well and you will get people whom knows, and while at it, you must be much more proactive regarding what China is, an wast nation, with an impressive nature, and even more impresive culture and history, use it to you bluch of shame, like the Yankikes are, where as I cant see one bloody good reason to go there at all, apart from some nature sites, and big citys, they have nothing, nada, but somehow people drags their asses over there, beats me but that is happening.
Do somehing about that, it pays in the lomg run.

peace

Pave Way IV

Chinese pretty much hate Israel and know that Israel has compromised most modern consumer microprocessors with backdoors. Israel knows China 1) knows this and 2) won’t knuckle under to any Israeli pressure ever. Israel has zero influence in Chinese politics and never will have any (because the Chinese hate them). It drives Israel absolutely crazy.

Jens Holm

Competisions are like that. You seemes to ognore chinese as well as fx USA makes backdoors in their chips and programs as well.

Take a pill from Teva.

Yuu forget the most iomportant in this. You are not even able to produce simple plastic buckets even so many muslim countries has so much oil.

Jens Holm

Arrrh. Chinese are Jews too. Didnt You know.

Everybody seemes to be Jews if we dont follwed whats written and even more of us then muslims has been reading the good book, because iso many of You hardly can read and certainly not a Choran in 3-5 versions.

Maybee Ali Baba in China can :)

And in modern days as driving too fast forwards only looking back by mirrors to the past on. And then – again and again – the future knocks You out and You are a kind of selfdetonaters blaming fx Jews.

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