China’s Semiconductor Industry Receives a $290 Billion Boost Over Two Years

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China has massively funded its semiconductor industry, spending over $290 billion from 2021 to 2022, a striking contrast to the US’s allocation of $39 billion over a decade for semiconductor plant construction.

According to a study by JW Consulting, cited by DigiTimes, China implemented 742 investment projects in 25 provinces over the past two years. Roughly a third of the $290.8 billion was spent on purchasing equipment and materials for semiconductor component production.

The number of investment projects undertaken within China’s semiconductor industry has been increasing. While 2021 saw no more than 142 new and 187 ongoing projects, 2022 saw an additional 18 new projects, and the number of ongoing projects rose to 352.

The provinces of Anhui and Guangdong in China have become key geographical hubs for these projects. During the two-year period, Anhui implemented 304 investment projects worth $59 billion, while Guangdong implemented 66 projects worth $47 billion.

Across China’s semiconductor industry, 30% of the projects during this period were either associated with the production of materials for the industry (176 projects) or with chip-making equipment (56 projects). The most popular projects in the materials segment were those related to display production, followed by chip and device manufacturing.

In comparison, between 2016 and 2020, only 40 projects in the materials segment and just 7 projects related to semiconductor equipment were implemented in China.

The study’s authors characterize China’s current investment policy as more measured and directed towards developing entire industrial clusters. The focus of investment has gradually shifted from finished products to components and production equipment. Chinese authorities encourage cooperation within the semiconductor industry, a marked change from previous disjointed investment projects.

Author Profile

Martin Harris
I'm Martin Harris, a tech writer with extensive experience, contributing to global publications. Trained in Computer Science, I merged my technical know-how with writing, becoming a technology journalist. I've covered diverse topics like AI and consumer electronics, contributing to top tech platforms. I participate in tech events for knowledge updating. Besides writing, I enjoy reading, photography, and aim to clarify technology's complexities to readers.

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