China is committed to double the country’s IC production within the next ten years so that production is equal to usage. Given the size of the gap, this is a major task.
While it is true new equipment purchasing by multinational chip companies with fabs or packaging and test plants in China will increasingly be made in-country by Chinese RD and process engineering staffs there is still a major gap to leap.
Since China surpassed Japan and the US in 2007 to become the world’s largest consumer of ICs, China policy makers have increasingly voiced concerns about the "chip gap" between supply and demand.
In 2008, China consumed approximately one-quarter of the world’s ICs, yet manufactured only $5.6 billion in chips, enough to support only 8% of their domestic requirements.
By 2011, the China IC market will grow to $85 billion with domestic production expected to reach $8.2 billion, about 10%. By 2013, China’s share of the global chip market will reach 35%.
According to the SEMI World Fab Forecast, total spending on front end fabs (construction and equipping) in China will grow by about 67% in 2010 to over $2 billion. This includes new, used equipment and any self-made equipment purchased at over 20 fabs.
EETimes reports that in materials, China is projected to spend $3.75 billion in 2010, up 15% from 2009, surpassing Europe and nearly approaching the levels of US spending.