Self-Sufficient China Aims to Meet 80% of Its Own Chip Needs by 2030

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China's semiconductor industry is formulating new goals for 2030: 80% self-sufficiency, a fully domestic 7-nm-line and stable 14-nm-production. However, hurdles in lithography, EDA and material supply could jeopardize these ambitions.

China's semiconductor industry is stepping up its drive towards self-sufficiency. According to industry sources, 13 leading managers have drawn up a roadmap with which the country aims to cover around 80% of its own chip requirements from domestic production by 2030. This would be a significant step for the electronics industry, as this share was only around 33% in 2024.

The target is ambitious and is reminiscent of previous industrial policy programs that fell short of expectations. However, unlike in the past, the current initiative is more operational: in addition to the general self-sufficiency quota, the plan also mentions specific technical milestones, including a 7 nm production line built and tested with equipment developed entirely in China and stable production of 14 nm ICs.

Expansion of Equipment and Capacities

At Semicon China, the extent to which the expansion is now targeting the entire value chain was demonstrated. Chinese suppliers presented new systems for advanced logic processes, including solutions for 5 nm and below. At the same time, suppliers such as Naura are expanding their portfolio through acquisitions and new products with technologies in the nanometer range.

At the same time, production capacity for established process nodes is increasing significantly. According to SEMI, China's share of global production capacity for mature nodes is set to grow from 25% in 2024 to 42% in 2028. This would further strengthen the country's role, particularly in high-volume electronics applications, such as in the industrial, automotive and consumer segments.

An important lever here is the localization of systems. Already today, the requirement for new fab installations is that 50% of the equipment used should come from domestic production. This increases the competitive pressure on international suppliers, while Chinese suppliers could gain market share more quickly along the front-end, back-end and material processes.

Advanced Packaging as a Strategic Lever

In addition to wafer production, advanced packaging is increasingly taking center stage. Industry representatives see this as an opportunity to partially compensate for technological limitations in the most modern production nodes. Among other things, next-generation packaging with significantly lower surface roughness was mentioned, which should improve the performance of complex chip systems.

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The increasing demand for computing power for AI applications is also likely to accelerate this trend. At Semicon China, it was emphasized that agentic AI and inference-heavy workloads are generating additional demand for high-performance semiconductors. For the market, this means that not only the pure structure width, but increasingly also packaging, integration and system performance will become a competitive factor.

Despite all the progress made, key bottlenecks remain. Especially in photolithography, core equipment, materials and EDA software, there is still a noticeable gap between China and international suppliers. The fact that global industry giants such as ASML, Tokyo Electron, Canon as well as Applied Materials, Lam Research and KLA remain present at the fair underlines the fact that China is not yet self-sufficient in several key areas, especially when it comes to semiconductor manufacturing machinery. Nevertheless, a trend towards the regionalization of Chinese supply chains and the growing Chinese influence in standard technologies, packaging and manufacturing capacities cannot be denied.(sg)

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