China mulls steps to woo more chip MNCs

China welcomes multinational semiconductor enterprises to establish research and development centers, production bases and operational hubs in the country, benefitting from its vast market potential, the country's top industry regulator said.

Gao Dongsheng, chief economist at the Ministry of Industry and Information Technology, said China is committed to expanding international cooperation in semiconductors, which form the bedrock of the information society and represent a strategic, foundational and forward-looking industry essential to modern economic development.

"We welcome global semiconductor players to establish local R&D and manufacturing centers, share development opportunities offered by China's sizable market, and participate in building regional cooperation platforms," Gao said at the ongoing 22nd China International Semiconductor Expo, also known as IC China, in Beijing.

The expo, which concludes on Tuesday, has attracted more than 600 enterprises from the United States, the United Kingdom, South Korea, Japan, Israel and other countries.

Gao said the ministry will push for closer collaboration across the entire industrial chain, spanning chip design, manufacturing, packaging and testing, equipment and materials.

"By optimizing resource allocation and deepening convergence with emerging sectors such as artificial intelligence, new energy and smart connected vehicles, the ministry aims to create richer application scenarios and enhance the value of the industrial chain," Gao said.

Meanwhile, the government will continue to improve the industry environment by fostering market-led growth, guiding rational regional layout, facilitating the orderly flow of production factors and strengthening intellectual property protection. These efforts are designed to cultivate a first-class business environment that is market-oriented, law-based and internationalized, Gao added.

Zhang Li, secretary-general of the China Semiconductor Industry Association, said that China's IC sector maintained steady expansion during the 14th Five-Year Plan period (2021-25), with total industry sales exceeding 1.8 trillion yuan ($253.3 billion) in 2024 and notable progress made in technological innovation, product supply and industrial structure.

Zhang shared his outlook on future development, emphasizing the importance of building an integrated innovation ecosystem covering the entire industrial chain. In addition, he highlighted the need to strengthen application-driven development and actively open up new scenarios to help new semiconductor technologies move faster from labs to the marketplace.

He urged the industry to eliminate barriers between R&D, product verification and market application to improve the efficiency of innovation. In addition, he highlighted the need to strengthen application-driven development and actively open up new scenarios to help new semiconductor technologies move faster from labs to the marketplace.

"More efforts are needed to deepen global cooperation based on mutual trust, closer collaboration in technology compatibility, standards interoperability and personnel exchanges to create an open, win-win industrial ecology," Zhang, who is also president of the China Center for Information Industry Development, said.

On the product front, Chinese memory chipmaker ChangXin Memory Technologies launched a string of products at the expo, targeting applications from servers and workstations to personal computers, in a bid to meet high-end demand across various sectors.

As the world's largest chip market, China's semiconductor industry has advanced in recent years, said Roger Sheng, vice-president of research at market research company Gartner.

However, there is still a technical gap between Chinese chipmakers and their foreign peers, especially in cutting-edge semiconductor-making equipment and fundamental chip materials, Sheng said, adding that "some advanced chip packaging and testing devices are dependent on imports".

He said more efforts are needed to step up policy support and encourage domestic companies in the upstream and downstream of the semiconductor industrial chain to strengthen cooperation and increase investment in R&D, in order to master critical technologies in the sprawling sector.