BEIJING – In light of a global chip shortage and US sanctions, China’s Ministry of Industry and Information Technology on Monday declined to list targets for semiconductor manufacturing.
China is keen to become self-sufficient in competing technologies and less dependent on imports of semiconductors or chips, which are used in products ranging from laptops to automobiles. The country had previously announced that it plans to produce 40% of the chips it uses by 2020 and to increase to 70% by 2025.
But when asked at a press conference on Monday about chip production goals, ministry spokesman Tian Yulong did not share specific numbers. Instead, he explained how the government supported the industry with measures such as tax cuts and talent development.
“The development of the semiconductor industry is facing opportunities and challenges that require the world to strengthen cooperation and build the industrial semiconductor chain together so that it can develop in a healthier and more sustainable way,” said Tian, according to a report. CNBC translation of his Mandarin language comments.
His comments come because a global shortage of chips is forcing major automakers to cut production. The backlog in semiconductor manufacturing was driven by the high demand for electronics amid the coronavirus pandemic, and a highly specialized global supply chain that faced added pressure from the US-China trade tensions that began under the former president Donald Trump.
Last year, the Trump administration imposed restrictions on China’s largest chip maker, SMIC, preventing it from purchasing high-quality equipment needed for its manufacturing.
It is not yet clear what specific action US President Joe Biden will take. Last week, he signed an executive order to review supply chains in an effort to address the shortage.
Meanwhile, China’s ministry of industry and technology is trying to improve supply chain coordination in the country’s auto industry, where 90% of the chips used are imported, according to a state media report on Friday.
At Monday’s press conference, Minister Xiao Yaqing said ensuring supply chain resilience is a priority.
“We need to take a prominent place in improving the stability and competitiveness of industrial and supply chains … and take a strong lead in the highly competitive international market,” said Xiao.
Nationally, data shows that China failed to meet its target of 40% domestic supply by 2020 amid the coronavirus pandemic.
According to US market research firm IC Insights, only 15.9% of the $ 143.4 billion worth of integrated circuits – another name for semiconductors – sold in China last year was produced in the country.
Chinese leaders will kick off this week with an annual parliamentary meeting to set national development goals for the next five years and beyond.
– CNBC’s Arjun Kharpal contributed to this report.