China is preparing a $70 billion stimulus package for the semiconductor sector.

Support for the Semiconductor Sector with Massive Incentive Package

China is preparing a massive incentive package worth approximately $70 billion (500 billion yuan) to strengthen its semiconductor sector.

Technological Competition and Government Contribution

This move underscores China's determination to solidify its position in the ongoing technological competition with the U.S. and to increase government support for the semiconductor industry. Sources speaking to Bloomberg reported that officials are considering a subsidy and financial support package ranging from 200 billion yuan ($28 billion) to 500 billion yuan.

Pekings' Goal: Reducing Foreign Dependency

With this incentive, Peking aims to reduce its dependency on foreign chip manufacturers like Nvidia. While the government continues to support domestic firms like Huawei Technologies and Cambricon Technologies, it is also considering the sales of powerful Nvidia chips like H200, which were approved during the Trump administration.

New Program and Current Government Funding

According to sources, this new Chinese program will operate independently from existing funding plans like the $50 billion Big Fund III.

Xi Jinping's Vision

Chinese President Xi Jinping has pledged to mobilize all national resources to increase the country's semiconductor capacity. In this context, he emphasizes that necessary steps will be taken to avoid being affected by the uncertainties caused by U.S. export pressures.