China is still lagging behind other countries in the production of semiconductors, a senior government minister has warned, despite concerted efforts by Beijing to catch up through billions of dollars in subsidies.
“We are still decades behind developed countries and the road to becoming a great manufacturing power remains long,” Xin Guobin, deputy director of China’s Ministry of Industry and Information Technology, said at a forum in Beijing.
China currently imports 95% of the high-end chips it uses in the construction of phones, computers, and servers, which it then ships on to other countries in the global supply chain. Roughly one-third of China’s exports are products that require semiconductors, according to the Financial Times.
The case of ZTE highlighted the dependency of Chinese companies on technology imports, after the company announced the closure of its core businesses just weeks after a ban was enforced on its US suppliers. According to the FT, some have even criticised the government’s confidence in the country’s homegrown technological capacity, saying that China is still not ready to face global competition.