China is once again digging deep into its pockets to become self-sufficient in semiconductors.

The new Chinese-backed semiconductor investment fund 
has a capital of 344 billion yuan, or $47.5 billion. It was officially launched on May 24.

The country’s relatively bleak economic situation suggested that this fund, 
which had been anticipated for several months , was likely to be smaller than its predecessors. Local institutions, in particular, were called upon to contribute.

According to data from the Tianyancha platform, relayed by Reuters , the local governments of Shenzhen and Beijing did participate. However, the Chinese Ministry of Finance was the largest contributor, with 17%. China Development Bank Capital followed with 10.5%. Other state-owned banks completed the picture.

Ultimately, the third phase of the “China Integrated Circuit Industry Investment Fund,” nicknamed “Big Fund,” is larger than the previous one in 2019. This is logical, given that the United States is not letting up in its efforts to limit China’s access to the sector’s most advanced technologies . Washington highlights Beijing’s dual-use of components, but also openly admits to wanting to hinder its rival’s progress, particularly in AI.

The Big Fund was created in 2014 as part of the “Made in China 2025” plan. This plan aimed to make China more self-reliant and even achieve a leading position in several strategic sectors. Extremely dependent on semiconductor imports, the fund was tasked with developing an entire industry.

Some successes can be attributed to this program: production has increased, particularly in the area of ​​mature chips , and Huawei and the foundry Semiconductor Manufacturing International Corporation (SMIC) have managed to manufacture advanced chips despite Western export restrictions. However, the initial objective is far from being achieved, to the point of raising some questions in Beijing about the effectiveness of the program.