China’s secret weapon in chip battle with US: intense city rivalry
China’s megacities are racing to draw capital to the semiconductor sector as they compete to become chip powerhouses
China’s megacities are moving in tandem to draw capital to semiconductor research and development, as Beijing accelerates its chip self-sufficiency drive in the face of tightening US export controls.
Major technology hubs including Shenzhen, Shanghai and Hangzhou – and even lesser-known players like Hubei province – have all launched major chip industry investment projects in the past few months, with regions competing to emerge as powerhouses in the strategically vital sector, according to observers.
Shenzhen – the southern city often dubbed China’s Silicon Valley – unveiled a new 5 billion yuan (US$700 million) fund on Thursday, which will invest in chip design projects, as well as critical equipment, components and advanced packaging technologies.
The fund is backed by the Shenzhen municipal government and a district-level state investment vehicle from the city’s semiconductor cluster, according to registration information, and is set to run for 10 years.
“Artificial intelligence and semiconductors have emerged as the front line of this contest,” Peng said. “Chips, robotics and new materials are all areas that need government support to strengthen local capabilities and shore up weak spots.”