China Invests Money in Chip Equipment

China wants to invest 29 billion dollars in the second tranche of the »Big Fund« - primarily for IC design, chip equipment and materials.

The second round of the "China Integrated Circuit Industry Investment Fund", also known as the "Big Fund", with a budget of 200 billion yuan, is intended to make the country as independent as possible of foreign suppliers. Events over the past few years have shown China that dependence cannot be countered by building its own chip factories alone. The design tools for designing the chips, the machines for semiconductor production and special materials for semiconductor production also come largely from companies outside China, most of them from the USA.

For example, Fujin Jinhua Integrated Circuit was unable to start manufacturing DRAMs in a $5.6 billion plant at the end of last year, as originally planned, because the USA had banned the company from supplying them. Fujin Jinhua Integrated Circuit is said to have illegally obtained IP from Micron, and UMC is also involved in the affair.

The Big Fund, set up in 2014, was intended to enable the company to set up its own semiconductor industry, with the focus on setting up its own chip start-ups that develop ICs such as processors, NAND memories and DRAMs, as well as setting up its own factories. In the areas of design tools and equipment, less was happening. Recently, according to a South China Morning Post report, companies from these areas had received money from the Big Fund, including Changchuan Technology, a manufacturer of IC test equipment, and GigaDevice, a developer of flash memories.