Full Breakdown
China's Semiconductor Industry Pushes for State Support in Five-Year Plan
3/10/2026, 6:58:50 AM
Emphasis on Semiconductor Development
China's semiconductor entrepreneurs have expressed strong support for the country’s 15th five-year plan, which prioritizes the chip industry as a fundamental aspect of Beijing’s technological ambitions. During the annual parliamentary meetings, known as the “two sessions,” key figures from the semiconductor sector, including representatives from Cambricon Technologies and Tongfu Microelectronics, emphasized the importance of focusing on their operational excellence. The draft of the five-year plan highlights the need for advancements in integrated circuits and chips, aiming to enhance capabilities in both mature and advanced process technologies. Specific attention is given to the wide-bandgap semiconductor industry, which utilizes materials like silicon carbide and gallium nitride, alongside high-performance AI chips.
Calls for Increased State Support
During the same sessions, industry representatives urged the Chinese government to provide stronger backing for the development of artificial intelligence chips and critical materials. Scholars and entrepreneurs advocated for leveraging China's strategic advantages in raw materials to expedite technological breakthroughs. Zhang Yunquan, a professor at the Chinese Academy of Sciences, highlighted the need for government intervention in regulating AI computing power prices, which are crucial for data centers supporting modern AI workloads. He noted that intense competition has led to detrimental low-price strategies, a phenomenon he termed “involutionary competition.” Zhang proposed the establishment of a unified trading market for computing power, likening it to commodities such as electricity and oil.
Industry Perspectives
Hao Yue, a deputy to the National People’s Congress and vice-president of Xidian University, underscored China’s industrial leverage in rare earth elements, which are vital for semiconductor manufacturing. The collective sentiment among industry leaders is that enhanced state support could facilitate the rapid commercialization of AI chips, positioning China favorably in the global technology race.
Official Statements & Responses
The Chinese government’s draft five-year plan reflects a commitment to refining and strengthening the semiconductor sector. It outlines goals for breakthroughs across the semiconductor value chain, including improvements in key equipment, materials, and components, as well as talent training initiatives.
Criticism & Opposition
Despite the optimism surrounding the five-year plan, some critics argue that the reliance on state support could stifle innovation and competition within the semiconductor industry. Concerns have been raised about the potential for government intervention to create inefficiencies, as companies may become dependent on state backing rather than pursuing independent advancements.
Verbatim Quotes
- “for companies like ours, the key is to focus on doing our jobs well” — Chen, Member of the Chinese People’s Political Consultative Conference
- “Competition among companies is fierce, with most resorting to low-price tactics, leading to ‘involutionary’ competition,” — Zhang Yunquan, Professor, Chinese Academy of Sciences
- “unified trading market where computing power across the country can be traded uniformly” — Zhang Yunquan, Professor, Chinese Academy of Sciences
The developments in China's semiconductor industry reflect a strategic pivot towards enhancing domestic capabilities and securing a competitive edge in the global technology landscape.
