Huge Opportunities In Chinese Market

China’s massive semiconductor market and Europe’s prowess in smart car, IoT and other emerging technologies are complementary forces that underscore opportunities for deeper global semiconductor industry cooperation, SEMI China President Lung Chu said in November at the SIIP China Europe Forum during SEMICON Europa in Munich.

In his speech “The Rise of China IC Industry – a Global Ecosystem Partner,” Lung Chu pointed to the China semiconductor market’s position as the world’s largest with strong continuing growth in highlighting the country’s rising importance in the global semiconductor industry. China’s chip industry accounts for 80 percent of smartphones, 70 percent of notebooks/tablets and 60 percent of smart TVs manufactured in China, he said. However, because of its heavy reliance on imports, China’s semiconductor industry faces a huge gap between supply capacity and market demand for semiconductor materials.

Lung Chu highlighted the goals set out in China’s Integrated Circuit Industry Development Promotion Outline and heavy investments from the country’s fund supporting key semiconductor sectors in China as key catalysts for overcoming the supply capacity shortage the industry has faced in recent years. The timing for promoting the outline and the fund is perfect for spurring rapid growth of China’s semiconductor industry, he noted.

Lung Chu said that investments from the fund are driving rapid growth in IC design, manufacturing, packaging and testing, equipment and materials, and other industry sectors. However, China’s integrated circuit industry still struggles with a larger supply capacity shortage than European and other countries even as China continues to be a key driver in the global semiconductor industry.

With China’s stable economy, he predicted the country’s semiconductor market will long remain the largest in the world, driven by growth across a number industries. By 2020, China expects to sell three to four million electric vehicles annually, operate more than 30,000 kilometers of high-speed rail, and reach a smart grid capacity of 100GW. In the longer term, the development and maturity of technologies such as 5G, Artificial Intelligence (AI), the Internet of Things (IoT), big data, smart manufacturing, intelligent transportation, and smart grids in China will continue to drive global semiconductor industry growth. China will also mature, evolving from low-cost manufacturer to system solution provider and technological innovator, to become an even more important partner in the global industrial ecosystem.

While China and Europe’s technology, innovations and markets are complementary, Lung Chu encouraged the two regions to deepen their communication and collaboration for their mutual benefit. Europe, especially Germany, enjoys significant strength in smart car, IoT and other emerging technologies. China’s might is the huge scale and sustainable development of its semiconductor market, offering important opportunities to Germany and the European semiconductor industry as a whole.

The SEMI China Innovation Investment Platform – SIIP China – is contributing to this effort with the establishment of strategic partnerships with associations and organizations including BCS (Business Cluster Semiconductors Netherlands), Silicon Saxony, Silicon Europe and Holland High-tech. SIIP China is also partnering with Silicon Valley and Israeli organizations to improve collaboration between China and its global partners and to help more semiconductor companies worldwide prosper.

In doing so, SIIP China is fulfilling its mission as an industry investment, financing and communication platform that leverages SEMI’s global industrial resources to raise international capital and collect intelligence to promote sustainable semiconductor industry development in China, encourage global technology investments, and promote collaboration among China and its global partners.

To learn more about the trends and opportunities for semiconductor investment in China, please visit SEMI China IC Industry Outlook 2017 Edition. You can download a sample report here. More information about Semiconductors in China is available at SEMI Window on China.