Chinese provincial governments offer millions of yuans in subsidies to local semiconductor projects amid China’s chip self-sufficiency push

March 12, 2023 4:30 pm

The municipal government of Chengdu is providing up to 500 million yuan (US$72 million) in subsidies to local semiconductor companies for significant chip projects.

According to Chengdu's Economic and Information Technology Bureau, major projects in the manufacture, packaging, and testing of integrated circuits, as well as related equipment and materials, will be covered by the subsidies.

Local officials in Nanjing, the capital of eastern Jiangsu province, unveiled a scheme that pays up to 20 million yuan in subsidies to semiconductor manufacturers in the city days before Chengdu's announcement, according to a People's Daily story.

Taiwan Semiconductor Manufacturing Co,the world's largest contract maker of advanced chips, has set up a major fountry in Nanjing.  

The most populous city in eastern Jiangsu province, Suzhou, announced in February that it intended to raise semiconductor sector output by 20%.

That came after similar semiconductor-related initiatives were initiated by the municipal governments of Guangzhou, Hangzhou, and Shenzhen, the southern tech hub, as well as the Jiangsu provincial government.

The IC-focused initiatives in the cities are part of a larger trend in China among local governments to assist the nation's quest for semiconductor self-sufficiency,

A new team of representatives from semiconductor firms have attended China's two sessions, a sign of Beijing's shifting priorities as it seeks to strengthen its position in light of Washington's restrictions on access to cutting-edge technologies.

Newcomers to the events include representatives from chip firms Semiconductor Manufacturing International Corporation (SMIC), state-backed Hua Hong Semiconductor Ltd, Shandong Youyan Semiconductor Materials Co. in the NPC and Cambricon Techologies Corp in the CPPCC.

Two sessions is an annual parliamentary meeting that gathers delegates from across China to discuss and approve national priorities.