The China Integrated Circuit Industry Investment Fund, also known as the Big Fund, is planning to launch its third investment initiative supporting the country’s development of advanced semiconductors.
People familiar with the matter told Reuters that China’s state-owned fund aims to generate investments worth $41 billion, a significant increase compared to the previous funds worth $18.93 billion in 2014 and $27.3 billion in 2019, respectively.
One of the sources said China’s finance ministry plans to participate in the fundraising effort with a contribution of $8.19 billion.
SINO-IC Capital and China Aerospace Investment are being considered as investment managers for the third fund. SINO-IC Capital already facilitates the first two funds, while China Aerospace Investment is the investment arm of state-owned China Aerospace Science and Technology Corp.
Earlier this year, state media reported that Chinese President Xi Jinping saw the need for the country to strengthen its science and technology research capability, citing competition from abroad.
The pressure to self-develop chips follows wide-ranging export sanctions coming from the United States and its allies over concerns that the technology could be used to improve Chinese military capabilities.
In October 2022, the U.S. Department of Commerce’s Bureau of Industry and Security said the export controls would prevent China from developing supercomputers and advanced semiconductors.