Beijing Wants to Create World-class Chip Industry by 2030

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Beijing plans to unveil new policies for developing a world-class semiconductor industry by 2030,  in order to reduce China’s costly dependence upon imported overseas technology.

The state-owned Economic Information Daily reports that the Ministry of Industry and Information Technology plans to unveil a series of policies to address the inadequacies of advanced integrated circuit technology and smart sensor innovations in China, as well as further drive the country’s “National Integrated Circuit Industry Advancement Outline” (国家集成电路产业推进纲要).

“China’s integrated circuit industry is still behind advanced global standards, and in addition to needing to spend huge amounts of capital each year on the import of various integrated circuit products and technologies, the short-comings of the integrated circuit sector are extremely restrictive for the development of other industries.”

Access to semi-conductor technology recently rose to the fore during trade disputes between China and the US, with Washington barring domestic chip companies from selling goods or services to Chinese telecommunications giant ZTE.

Shen Changxiang (员沈昌), a member of the Chinese Academy of Engineering as well as the State Integrated Circuit Industrial Development Consulting Commission (国家集成电路产业发展咨询委员会委员) said to Economic Information Daily that China’s annual imports of integrated circuit products currently exceed its imports of oil in value, and that a large volume of core products and technologies must all be imported from abroad.

“This not only restrains the overall development level of China’s information industries, it also restrains the development of other sectors that are closely tied to the information industry.

“For example, at present China’s smart phone industry is seeing rapid development, but integrated circuit products must all be imported, including CPU’s, memory chips and various sensor components.

“This means that it’s impossible for domestic manufacturers to occupy a leading position within the industry when it comes to the added value for smartphones, making it even more difficult to achieve revenue increases.”

Shen said that once key products and technologies can be produced domestically, China’s integrated circuit and information industries will achieve surging growth.

This will remove Chinese industry from a passive position, as well as help to increase its influence and clout on the international market.

The new policies that MIIT plans to launch will accelerate breakthroughs in key products and technologies, expediting the rapid growth of China’s integrated circuit industry, as well as closing the gap between domestic industry and leading international standards.

China will create a series of integrated circuit industry innovation platforms, advance the concentration of key factors including technology, human talent, capital and markets; drive the creation of a state-level smart-sensor innovation centre, create an 8-inch joint technology development platform, achieve breakthroughs in high-aspect ratio processing technology, accelerate the establishment of a state-level integrated circuit advanced industrial technological centre, and achieve breakthroughs in industrial technologies for dimensions of under five nanometers.

It also has plans to launch a digital optoelectronics centre, establish industrial platforms for products including III-V chips and silicon photonics chips, achieve breakthroughs in 400G silicon photonics components, accelerate plans to establish a printed and flexible display innovation centre, and undertake research and development of large-scale printing and quantum dot printing technologies.

Since the turn of the decade Beijing has expanded its drive to acquire and develop advanced technologies, with the launch of the Made in China 2025 initiative, as well as the “Internet Plus” and “Smart Manufacturing” national strategies.

Beijing commenced the launch of a series of key industrial policies in 2014, including the National Integrated Circuit Industry Advancement Outline, while the State Strategic Consulting Commission for Establishing a Great Manufacturing Nation (国家制造强国建设战略咨询委员会) also placed the chip industry on its list of key sectors for development.

According to the targets outlined by the Strategic Consulting Commission, by 2020 China’s integrated circuit industry will have gradually narrowed the gap with international advanced levels, while full industry sales revenue will see average annual growth of over 20%, and chip-related technology in key areas including mobile smart platforms, internet communications, cloud computing, the Internet of Things and big data will have reached international advanced levels.

By 2030, the Commission wants the key links in China’s integrated circuit industry to have reached advanced international standards, and a cohort of domestic companies to have joined the global upper echelons.

The Commission forecasts that by the end of the 13th Five Year plan (2016 – 2020) domestically produced integrated circuit products and technologies will see an increase in their market share of 30 percentage points, as well as satisfy 50% of internal demand, for an increase in sales revenues of approximately USD$50 billion.

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