China has set up a new Rmb204.15bn ($28.9bn) national semiconductor fund, US media said. China is seeking to nurture its local chip industry and close the technology gap with the United States. The government-backed fund was set up on the 22nd, larger than a similar fund launched in 2014, raising about Rmb139bn, according to the Wall Street Journal website on October 25.
The new fund is the latest sign of China’s determination to reduce its reliance on U.S. technology, the report said.
In the semiconductor sector, China still faces a long road to global dominance, the report said.
The report also said the fund invested billions of dollars in dozens of projects in 2014. One of them is Changjiang Storage Technology Co., Ltd. The company said in September that it had begun mass production of an advanced memory chip called 64-tier 3D NAND Flash.
The company is fast catching up, but it still lags behind South Korea’s industry leaders such as Samsung Electronics, which is already producing more advanced chips, the report said.
Overall, analysts believe China is still lagging behind rivals such as Intel and Samsung in key areas of semiconductor technology.
In addition to chips, another major bottleneck in China’s self-sufficiency efforts is chip-making equipment, which China does not dominate, the report said. Leading companies include Applied Materials and Panlin Group, AsmL Holdings of the Netherlands and Tokyo Electronics of Japan.
China imported $312.1 billion worth of semiconductor products in 2018, more than $240.3 billion in crude oil imports, according to the report.