Jakarta, CNBC Indonesia – China is increasingly ambitious in working on the domestic chip industry. This proves that the Xi Jinping government is not cowed by sanctions banning the export of chip manufacturing equipment from the United States (US) and allies.
According to two industry sources, the Chinese government will launch a new funding program worth US$ 40 billion or around Rp 610 trillion to advance the semiconductor sector. This is in order to increase competitiveness with the US and other competitor countries.
If these reports are true, this latest funding will be the largest of the two previous government funds launched through the China Integrated Circuit Industry Investment Fund or ‘Big Fund’.
Previously, similar funding was released in 2014 worth 138.7 billion yuan (Rp. 289 trillion) and in 2019 worth 200 billion yuan (Rp. 417 trillion), quoted by Reuters, Tuesday (5/9/2023).
One of the areas of investment being focused on is the supply of chip manufacturing equipment. This is because so far China has relied on foreign manufacturers (US, Netherlands, Japan) to support these components.
However, the US announced new rules in October 2022 limiting exports of advanced chip manufacturing tools to China. The decision is predicted to be an attempt to paralyze China’s technology industry.
Chinese President Xi Jinping has long warned about the importance of letting go of foreign dependence for semiconductor business. The urgency is getting higher after the relationship between China and the US heats up.
According to inside sources, a new funding program for China’s chip sector has been approved. China’s Ministry of Finance plans to contribute 60 billion yuan (Rp 120 trillion) to support the program, according to one source.
Until now, Big Fund has not confirmed this news. According to all inside sources, this funding program is still confidential.
China’s Ministry of Finance and Ministry of Industry and Information Technology declined to comment.
It is not yet clear when this funding program will be officially launched. The timeline and detailed plans for the funding have not yet been disclosed. Let’s wait.
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