China to Write $10B Check for Chips

Rick Merritt, EETimes
1/14/2015 11:57 AM EST

HALF MOON BAY, Calif. — China is expected to invest this year half the $20 billion fund it set aside to grow its semiconductor industry. As much as 70% of it is expected to target its domestic wafer fabs.

The initiative is the latest of several failed attempts over the past 25 years to make China a significant producer of chips. This time around the government is taking a more market-oriented approach that will give it a better shot at success, said one executive bidding for as much as half the funds.

"It's not clear if the new scheme will work, but I think it's the right direction," said Simon Yang, chief executive of XMC, one of China's two 12-inch fabs that hopes to get as much as $10 billion

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