Skip to content
Tim Culpan

China Has Painted Itself Into a Semiconductor Corner

Lost billions, graft probes, and broken dreams are the result of over-ambitious goals to build a leading chip sector.

No round of applause yet from Beijing for its chipmakers.

No round of applause yet from Beijing for its chipmakers.

Photographer: Bloomberg

As Washington embarks on a multi-billion dollar, decade-long semiconductor development campaign, Beijing is reckoning with its own 20-year effort that’s largely failed to deliver. Both will need to grapple with wasted funds and misguided goals as they play catch-up to Taiwan and South Korea.

Architects of China’s ambitious efforts may be facing the music for having not produced world-beating technology, Bloomberg News reported this week. Multiple corruption probes announced by authorities stem from anger among the nation’s top leaders over an inability to develop semiconductors that could replace American components, it reported. Two of the most scrutinized areas are the $9 billion bailout of Tsinghua Unigroup Co., and the National Integrated Circuit Industry Investment Fund — known as the Big Fund.