China's lack of core pain: 2013 chip imports up to 231.3 billion US dollars

The central and local governments have issued hundreds of billions of integrated circuit funds. Semiconductor has become the hottest concept in China's ICT industry. The industry generally believes that the industry will usher in a “golden age”. As a global electronics manufacturing powerhouse, IC has always been one of the largest imported goods in China. Faced with the current status of “the international capacity is saturated and the local capacity is lacking”, how can China get rid of the “pains of the lack of core”?

Lu Jun, President of Huaxin Investment Management Co., Ltd. revealed during the "84th China Electronics Show" held in Shanghai recently that since the establishment of the National Integrated Circuit Industry Investment Fund, the first phase of the fund size was 120 billion yuan according to the approval plan of the State Council. At present, the scale of funds with a clear intention to invest has basically reached the fund raising scale, and it is expected to achieve super-raising."


On September 24 of this year, China National Capital Corporation, China National Tobacco Corporation, Beijing Yizhuang International Investment Development Co., Ltd., etc., jointly signed the "Initiator Agreement of the National Integrated Circuit Industry Investment Fund Co., Ltd.", marking the investment of the national integrated circuit industry. The fund was formally established.



The National IC Industrial Investment Fund will focus on IC chip manufacturing in the future, taking into account chip design, packaging and testing, equipment, and materials. In terms of specific methods, the first will be to lay out the entire industrial chain and form a good industrial ecology; second, to rely on leading backbone enterprises to promote the integration of industrial resources; third is to promote the development of industrial agglomeration with the support of key regions.


Xu Xiaotian, executive vice chairman and secretary-general of the China Semiconductor Industry Association, said that the National Integrated Circuit Industry Investment Fund is the largest industrial investment fund approved by the State Council so far. It is estimated that 120 billion yuan of central investment will drive the investment of local government and social capital. More than 500 billion yuan, thus injecting strong momentum for the development of the integrated circuit industry.


"Saturation of international production capacity and lack of local production capacity" is a big picture of the current global integrated circuit industry. In recent years, China has vigorously developed the information industry. However, chips need to be purchased from a large number of foreign countries, and the lifeblood of development lies in the hands of others. In 2013, the import volume of integrated circuits in China was as high as 231.3 billion U.S. dollars. Over the years, it has ranked the largest two imported goods together with petroleum.


In 2013, China produced 1.46 billion mobile phones, 340 million computers, and 130 million color TVs. However, it mainly focuses on complete machine manufacturing. Because the core links of the value chain with integrated circuits and software are missing, the average profit of the industry is only 4.5%, 1.6 percentage points lower than the industrial average.


Over the years, China's integrated circuit industry has been insufficiently invested. From 2008 to 2013, the total investment in fixed assets of China's integrated circuit industry was only about US$40 billion, while US Intel Corporation invested 13 billion US dollars in 2013. With the establishment of central and local integrated circuit investment funds, local leading manufacturers are expected to receive substantial funding support.


Experts pointed out that the favorable factor for the development of China's integrated circuit industry is that China has the largest and fastest growing integrated circuit market in the world. In 2013, the scale reached 916.6 billion yuan, accounting for 50% of the global market share. With the transformation of economic development methods, the accelerating adjustment of industrial structure, and the simultaneous development of new industrialization, informatization, urbanization and agricultural modernization, the demand for integrated circuits will increase substantially.


"China's integrated circuit industry will usher in the golden age." Qiu Ciyun, CEO and Executive Director of SMIC, said recently.


According to Wang Xiaolong, a researcher at Takuma Industrial Research Institute, it is expected that the revenue of China's IC industry will increase by 20% in 2015, supported by the government’s heavy investment support.


According to Ye Tianchun, head of the national ultra-large-scale integrated circuit manufacturing equipment and assembly process expert group, China's integrated circuit industry is ushering in the “three-chain integration” era of industrial chain, innovation chain, and financial chain. Only three chains can closely cooperate to promote the industry. Bigger and stronger. At present, major breakthroughs have been made in the domestic integrated circuit innovation chain, and when the financial chain is justified, the industry chain still has a long way to go.


In Ye Tianchun's view, the current task of the National IC Investment Fund is to activate the financial chain and guide the formation of the triple-chain integration; to concentrate on the development of advantageous regions and not to blossom everywhere; to promote the integration of the industrial chain and strive to cultivate world-class enterprises and industrial clusters.


Li Liyou, chairman of Spreadtrum Communications, stated that the highest gross profit rate in the integrated circuit industry chain is the design industry. The growth rate of integrated circuit design companies in our country exceeds 15% every year, and IC design industry is entirely likely to catch up with world-class standards in the next five years.


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