China is pumping another $47.5 billion into its chip industry

China is establishing its largest-ever semiconductor state investment fund worth $47.5 billion. This move comes as the US imposes restrictions on the export of American chips and chip technology to curb Beijing’s ambitions. The fund, supported by six state-owned banks, aligns with Chinese President Xi Jinping’s goal of enhancing China’s position as a tech superpower. With the “Made in China 2025” roadmap, China aims to lead in industries like AI, 5G, and quantum computing. The fund marks the third phase of the China Integrated Circuit Industry Investment Fund, focusing on chip manufacturing, design, equipment, and materials. The fund had previous corruption scandals, and China faces roadblocks due to US export controls and its own restrictions on key chipmaking materials. The chip fund serves as a defensive measure against sanctions and supports Xi’s aspirations for China to become a global technology leader.