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China weeds out chip industry weaklings by raising bar for aid

Tax breaks will be narrowed to focus investment on winners

Employees work at a chip production line at an electronics company in Chizhou, Anhui province.    © Reuters

BEIJING -- China will limit tax breaks and other state support for semiconductor companies to only those that show an ability to produce the home-grown breakthroughs that Beijing seeks, government plans show.

The semiconductor industry is a national economic security priority in China's latest five-year plan, approved at the National People's Congress session that closed Thursday.

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