China crafts £116bn chips support package as it tackles US curbs with WTO
China is reportedly crafting a $143bn (£116.5bn) package to support its semiconductor industry, as it tackles new US trading curbs with the World Trade Organisation (WTO).
The package would be a major pillar in sustaining its chips sector, which is currently fielding attempts from the US to slow its technological advances.
Beijing plans to roll out the package, which seeks to rival the US’ $52bn worth of fiscal incentives, over the next five years, starting as soon as the first quarter of next year, according to a report by Reuters, citing three sources.
Most of the capital is expected to go towards bringing more semiconductor fabrication plants under Chinese ownership, sources said.
Semiconductor companies are thought to be entitled to up subsidies worth 20 per cent of the cost of purchasing new equipment or facilities.
The US unveiled significant semiconductor export controls in October, which ban Chinese companies from buying advanced chips and chip-making equipment without a licence over national security concerns.
However, China has launched a trade dispute with the WTO, calling the US curbs “trade protectionism”.
“China’s filing of a lawsuit at the WTO is to resolve China’s concerns through legal means and is a necessary way to defend its legitimate rights and interests,” China’s commerce ministry said in a statement today.