China Sets Up $47.5 Billion Fund for Local Chip Making
China has made a new state fund, called "Big Fund III," putting in $47.5 billion to help its local chip market grow. This new money aims to switch gears to build key photo gear and local chip design tools, moving from the old aim of just making factories.
The Trouble with Top Litho Tech
A big problem for China is that it can't get to top Extreme Ultraviolet (EUV) litho tech, needed for the best chips. The Dutch firm ASML is the only one making these EUV setups, and rules from other lands limit their sale to China. This makes the Chinese company SMIC make 7nm chips with old ways, which are not as good. They have more flaws and cost more than what leaders like TSMC can do.
Less Need for Foreign Design Tools
China is also trying to cut down on using foreign tools for designing chips. Right now, U.S. firms Synopsys, Cadence, and Siemens EDA run over 80% of this market. Even big Chinese chips like HUAWEI's Kirin were made using these tools. To fight this, China is boosting its own firms like Empyrean and Primarius, but these still can't match global big names yet.
View A Long Road to Stand Alone
Even with big spending, experts say going it alone in tech will take a long time. China is thought to slowly get better and catch up a bit, but it is expected to stay a step or two behind for a while. The more clear and soon-to-be-hit goal of this money is to keep a basic level of doing it themselves and guard their market from the effects of foreign rules.