China Has Big Plans for Homegrown Chips
China buys more than half the semiconductors sold each year, and its share is growing. Yet the nation doesn’t have one domestic manufacturer among the 10 biggest chipmakers, a list stacked with U.S. companies. Homegrown chips account for less than one-tenth of local demand, and in 2013 China spent more money importing chips than it did importing oil, according to researcher Sanford C. Bernstein.
As President Xi Jinping’s government trades allegations of cyber espionage with U.S. officials, China is stepping up its support of domestic chip production to lessen its dependence on foreign technology. The government is telling local companies and Chinese news media that it plans to invest as much as 1 trillion yuan ($161 billion) over 10 years to develop chips, about as much as Intel spends per decade on facilities and research and development.