China completes second round of US$29 billion Big Fund aimed at investing in domestic chip industry
- New investment is likely to lean towards applications in downstream supply chain, such as chip design, advanced materials and equipment areas
China is making swift progress on its 200 billion yuan (US$29.08 billion) fund aimed at investing in home-grown semiconductor development, as the world’s second-largest economy looks to reduce dependence on foreign chips amid a tech war with the US.
The state-backed China Integrated Circuit Industry Investment Fund, also known as the country’s “Big Fund”, has completed raising capital for its second tranche, the China Securities Journal reported on Friday, citing sources familiar with the matter.
New investment is likely to lean towards applications in the downstream supply chain, such as chip design, advanced materials and equipment areas, according to the report.
The fundraising progress comes amid an escalating tech war with the US, which has seen China tone down statements on its wider “Made in China 2025” policy ambitions, after President Xi Jinping first called for a drive towards technological self-reliance last year.
“We [should] hold innovative development tightly in our own hands,” Xi said in an address to the country’s top scientists and engineers at a conference in May last year. “[We have to] put much effort into key areas where we are facing bottlenecks … and make breakthroughs as soon as we can.”
The US regards elements of the Made in China 2025 policy plan as unfair state intervention in the economy and has recently ramped up pressure on the country’s hi-tech industry with trade restrictions. Telecoms gear maker ZTE was brought to the brink of collapse last year when the US cut off the supply of American technology to the company, citing violations of a previous agreement that censured the firm for breaching sanctions against trade with Iran.
