BEIJING – Faced with a global shortage of chips and US sanctions, China’s Ministry of Industry and Information Technology on Monday refused to name targets for semiconductor production.
China would like to build self-sufficiency in competitive technologies and rely less on imports of semiconductors or chips, which are used in products ranging from laptops to cars. The country had previously announced that by 2020 it would like to produce 40% of the chips it uses and raise this ratio to 70% by 2025.
However, when asked at a news conference Monday about chip production targets, ministry spokesman Tian Yulong did not share specific figures. Instead, he outlined how the government supports the industry with measures such as tax cuts and talent development.
“The development of the semiconductor industry faces opportunities and challenges that require the world to strengthen cooperation and build together the semiconductor industrial chain, to enable it to develop in a healthier and more sustainable way,” Tian said in a statement. CNBC translations of his mandarin – linguistic remarks.
His comments come as a global shortage of chips is forcing major carmakers to cut production. The lag in semiconductor production has risen from high demand for electronics amid the coronavirus pandemic and a highly specialized global supply chain that has faced additional pressures due to US-China trade tensions that began under former President Donald Trump. .
Last year, the Trump administration imposed restrictions on China’s largest chip maker, SMIC, which prevents it from buying state-of-the-art equipment needed for production.
It is not yet clear what specific action US President Joe Biden will take. Last week, he signed an executive order to review supply chains in an effort to address the shortfall.
Meanwhile, China’s Ministry of Industry and Technology is trying to improve supply chain coordination in the country’s auto industry, where 90 percent of used chips are imported, according to a state report on Friday.
During Monday’s press conference, the head of the ministry Xiao Yaqing said that ensuring the resilience of the supply chain is a priority.
“We need to put the stability and competitiveness of industrial and supply chains in a position of importance … and take full advantage of the initiative in a highly competitive international market,” Xiao said.
At the national level, the data indicate that China has not met its domestic supply target of 40% by 2020 amid the coronavirus pandemic.
Only 15.9% of the $ 143.4 billion integrated circuit value – another name for semiconductors – sold in China last year was produced in the country, according to US market research firm IC Insights.
China’s leaders are due to begin an annual parliamentary meeting this week to determine national development goals for the next five years and beyond.
– CNBC’s Arjun Kharpal contributed to this report.