China has officially set up its third state-backed investment fund aimed at bolstering its semiconductor industry, with a registered capital of 344 billion yuan ($47.5 billion), as disclosed in a filing with a government-managed companies registry.
The establishment of this fund aligns with President Xi Jinping’s emphasis on achieving semiconductor self-sufficiency, particularly in light of the U.S.’s recent imposition of export control measures citing national security concerns.
The newly established third phase of the China Integrated Circuit Industry Investment Fund, also known as the “Big Fund,” was formalized on May 24 and registered under the Beijing Municipal Administration for Market Regulation. The fund is the largest of the three launched by the Big Fund, with significant shareholders including China’s finance ministry and China Development Bank Capital.
Noteworthy investors in the fund include major Chinese banks such as Industrial and Commercial Bank of China, China Construction Bank, Agricultural Bank of China, Bank of China, and Bank of Communications. These entities, along with others, are contributing to the total capital injected into the fund.
Previously, the first and second phases of the Big Fund were initiated in 2014 and 2019, respectively, providing financial support to key players in China’s semiconductor industry. The fund has backed major chip foundries like Semiconductor Manufacturing International Corporation and Hua Hong Semiconductor, as well as Yangtze Memory Technologies and other smaller chip manufacturers.
The third phase of the fund is expected to focus on chip manufacturing equipment, with plans to engage at least two institutions for capital deployment. This move underscores China’s strategic approach to strengthen its semiconductor sector and reduce dependence on foreign technology.
