Semiconductor Self-Sufficiency Push Gains Pace
China's industrial enterprises produced 2,798 billion integrated circuit (IC) pieces in the first half of 2026, a surge of 23.1% year-on-year, the National Bureau of Statistics reported on July 15. The figure underscores the rapid capacity expansion underway at domestic fabs as China accelerates its drive for semiconductor self-reliance in the face of US export controls.
Production vs the World
- Output growth: +23.1% YoY — well above global semiconductor industry averages of around 15% for the same period
- Scale: At nearly 2.8 trillion pieces, China's output represents the largest volume production of chips globally by unit count
- Mature node focus: Much of the capacity expansion is in 28nm and above 'mature' nodes — the segments most critical for automotive, industrial and consumer electronics supply chains
- Advanced node constraints: Equipment restrictions on EUV and advanced DUV tools mean leading-edge (3nm/5nm) domestic capacity remains limited
Investment Pipeline
State-backed fab projects — including those led by SMIC, Hua Hong Semiconductor and CXMT (memory) — have drawn hundreds of billions of yuan in investment. Provincial governments have also allocated land, tax breaks and subsidies to attract semiconductor supply chains.
Strategic Context
The surge in output is a direct response to technology export controls imposed by the US and its allies since 2022. Washington has restricted access to advanced chip manufacturing equipment, EDA software and high-bandwidth memory, pushing China to develop an indigenous supply chain. The volume numbers are impressive, but the industry still faces bottlenecks in equipment, materials and advanced packaging.
Looking Ahead
IC China 2026, the national semiconductor expo, is scheduled for November 12–14 in Beijing, where the next phase of the semiconductor industry plan is expected to be detailed. Industry watchers will be watching for updated targets on domestic capacity, localisation rates and R&D investment.