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China's chip self-sufficiency drive in need of factory investment

Instead venture capital goes to fabless chip design startups in 64% of cases

China's level of self-sufficiency in making semiconductors hovers in the 20% range.   © Reuters

TOKYO -- China has for years encouraged investment in domestic semiconductor startups to increase the industry's self-sufficiency, but that goal remains elusive with much of the money going into fabless operations.

Chinese public and private investment vehicles financed chip startups in 865 cases between 2014 and May 2022, according to a survey conducted by iResearch, an analytic firm in China. In addition to providing funding and loans, the initiative envisioned taking the startups public and raising more capital.

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