BEIJING – Faced with global chip shortages and US sanctions, China’s Ministry of Industry and Information Technology declined on Monday 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 increase that ratio to 70% by 2025.
But when asked Monday at a news conference about chip production targets, ministry spokesman Tian Yulong did not share specific data. Instead, he outlined how the government supported 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 industry chain to enable it to develop in a healthier and more sustainable way,” Tian said. According to a CNBC translation of his Mandarin. linguistic observations.
His comments come because the global shortage of chips is forcing major carmakers to cut production. The delay in semiconductor manufacturing arose from high demand for electronics amid the coronavirus pandemic and a highly specialized global supply chain that has faced additional pressure from trade tensions between the United States and China. which began under former President Donald Trump.
Last year, the Trump administration imposed restrictions on China’s largest chip maker, SMIC, which prevents the purchase of high-end equipment needed for production.
It is unclear what specific action U.S. President Joe Biden will take. Last week he signed an executive order to review supply chains with a view to addressing shortages.
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 media report Friday.
During Monday’s press conference, the head of the ministry, Xiao Yaqing, said that ensuring supply chain resilience is a priority.
“We need to place the improvement of the stability and competitiveness of industrial chains and supply chains in a leading position … and take full advantage of the initiative in a highly competitive international market,” Xiao said.
Nationwide, data indicate that China failed to meet its 40% domestic supply target by 2020 amid the coronavirus pandemic.
According to market research firm IC Insights, only 15.9% of the $ 143.4 billion integrated circuits (another name for semiconductors) sold in China last year were produced in the country.
Chinese leaders plan to start 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.