China has been under pressure for the past three years after various technology restrictions imposed by the United States. Among those that received the biggest impact was the production industry that could only produce 24mm using old technology after the use of patents and the sale of printing machines began to be restricted. According to a Reuters report, China is currently preparing to inject funds of more than RMB 1 trillion (~RM635 billion) to support the local chip production industry.
These funds will be spent over five years in the form of subsidies, tax credits and increasing the study of chip production using local technology. It is expected to drive the semiconductor industry which is still not able to stand as high as the United States and Taiwan.
The first injection of funds is believed to take place as early as Q1 2023 according to sources cited by Reuters. China was forced to take this step as the United States tightened access barriers to technology it holds this year.
The sale of artificial intelligence chips for supercomputers has been banned over allegations they could be used for military purposes. Today Japan and the Netherlands agreed to block the sale of chip production machines because they are U.S. allies.