Throughout the world, the semiconductor global industry chain has achieved a high degree of specialization, but under the current situation, more and more countries will independently develop the semiconductor industry to the height of national strategic level. For China, although the semiconductor industry is currently facing the dual challenges of technology and international politics, the rapid growth of the domestic market provides an important opportunity for the upgrading and optimization of the semiconductor industry structure in China.

China's semiconductor chip production capacity has increased

     According to the statistics Bureau, from January to October 2023, China produced a total of 276.53 billion integrated circuits, an increase of 0.9% year-on-year. If you add the November data, it is expected that domestic chips have grown by more than 3%. Professional analysis, due to the sale of Mate60 series, coupled with the replacement of oil vehicles by electric vehicles, is the main driving force for the increase in chip production, and the leading effect is very obvious.

     For comparison, according to customs data

     If by amount, from January to November 2023, the total amount of chip imports was $316.6 billion, $62.6 billion less than the $379.2 billion in the same period last year, a decline of 16.5%.

     If by volume, from January to November 2023, the total number of chip imports was 437.6 billion, down 60.2 billion from 497.8 billion in the same period last year, a decline of 12.1%.

     According to the Semiconductor Industry Association

     In the first nine months of this year, U.S. semiconductor exports to China totaled $29.2 billion, down 17.6 percent year-on-year.

     In the first nine months of this year, South Korea's semiconductor trade surplus with China was $11.3 billion, but it was sharply down by $10.3 billion from the same period in 2022.

     The root cause is that we are frantically engaged in chip production capacity, and the semiconductor factory project under construction in Beijing, Shanghai, Guangzhou and Shenzhen alone will reach 65 in 2023. Foreign media reported that in 2021-2023, China's mainland semiconductor factory investment exceeded 20% of the world, up to more than 100 billion US dollars.

     In 2023, China's semiconductor chip production capacity has exceeded South Korea, ranking second in the world, second only to Taiwan Province. Foreign media is expected that by 2025, China's semiconductor production capacity will rank first in the world.

Semiconductor startups have seen a surge in funding

     According to data from research firm CB Insights, in the third quarter of 2023 (July-September), funding for semiconductor-related startups soared to the highest level since 2022, with 60% coming from mainland Chinese companies and 18% from the United States.

    Countries are seeking self-sufficiency in the semiconductor value chain.

The future of global semiconductor development focus in China

     According to the forecasts of various institutions, in 2023, with the policy support of various governments, as well as the rise of emerging markets such as 5G and AI, the semiconductor market is about to reach a turning point, and it is expected that the global semiconductor market will reach one trillion US dollars by the end of the year, and the global semiconductor market will likely return to double-digit growth next year.

     Looking at the world, the focus of development is still in the Asia-Pacific region, accounting for 60% of the world's share, of which China is the largest market, nearly 40% of the global market share, North America, the European Union and Japan followed, the entire European market 9.4% market share.

     Both in terms of production and reserves, China plays an indispensable role in the global semiconductor industry. If other countries want to develop new energy sources and successfully produce their own weapons systems, they will inevitably need to rely on China's semiconductor materials.

    At the same time, the rapid growth of the domestic market provides an important opportunity for the upgrading and optimization of China's semiconductor industry structure.

The process of localization is accelerating, and breaking the neck is just around the corner

     At present, China's semiconductor industry is in a stage of rapid development. The compound growth rate of China's semiconductor industry market size has reached 7.6% in the past three years, from manufacturing equipment to raw materials to design software, and constantly accelerate the research and development process, and have formed strong competitiveness in some areas.

    Experts predict that in the future, China will form a huge semiconductor market, with the government's policy support, will attract more professionals to the semiconductor industry development, will continue to promote the prosperity of the semiconductor industry.