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An employee of Semiconductor Manufacturing International Corp works at the company's factory in Beijing. [Photo/Xinhua] China's latest semiconductor policies will offer a golden opportunity
for the chip industry to pursue high-quality development and motivate
companies to achieve breakthroughs in crucial technologies, experts said
on Wednesday. The comments came after the State Council rolled out a set of
policies on Tuesday, including tax breaks and financing support, to buoy
the growth of the integrated circuit and software sectors. The State
Council said chip companies of all ownership types, including foreign
enterprises, that set up in China can benefit from the new policy
incentives. Wang Peng, deputy head of the China Center for Information Industry
Development, said support for semiconductor makers, in what is known as
the crown of electronics technologies, will have a profound impact on
the industry's development. "It showcases the government's desire to build a globally competitive
semiconductor sector, and it will encourage companies to devote more
resources to overcome technological bottlenecks," Wang said. Semiconductor chips have become a key part of the information technology infrastructure to power the digital economy. Last year, China, the world's largest semiconductor market, spent
about $305.6 billion on chip imports, more than the amount spent on
importing crude oil, the General Administration of Customs said. But the
number marked a 2.1 percent year-on-year decline, as domestic companies
made progress. Wen Ku, a spokesman for the Ministry of Industry and Information
Technology, China's top industry regulator, said the nation's
semiconductor sector maintained relatively sound momentum, with more
than 100 billion chips produced in the nation in the first half of 2020,
marking a 16.4 percent year-on-year increase. Mi Lei, founding partner of Casstar, a technology investment company
based in Xi'an, Shaanxi province, said the new policies, such as
granting a 10-year tax break for certain qualified chip companies,
showcase the government's "unprecedented" support for the sector over
the next decade. "It will greatly increase integrated circuit enterprises' profits,
and boost the confidence of all employees who work in the sector," Mi
said, "The move will also attract more private capital to bankroll
promising semiconductor companies." Xiang Ligang, director-general of the Information Consumption
Alliance, a telecom industry association, said that compared with
previous policies which chiefly benefit chip design enterprises, the new
package of favorable measures is designed to support companies in the
entire semiconductor chain, including chip equipment, material,
packaging and testing. "Such change underlines a rational and long-term vision for the
sustainable development of the semiconductor sector. The importance of
chips has been further underlined by the US government's efforts to
contain the rise of Chinese tech companies," Xiang said. The State Council also said that China will continue improving its
business environment for international chip companies to invest and
develop in the nation. More efforts will also be made to cultivate
talent for the semiconductor sector. Zhang Wenfeng, an engineer at a Shanghai-based chip startup, said he
was encouraged by the new policy incentive. "With strong government
support and local companies' growing input into R&D, this is the
best time for me to work at a chip company."
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