China invested three times more in chip development over a decade than the United States

China spends almost three‑quarters of what the United States invests in chips

According to a study by the U.S. Center for Strategic and International Studies (CSIS), from 2014 to 2023 China invested about $142 billion in developing its semiconductor industry. That is nearly thirteen times more than the amount spent by American authorities—$39 billion over the same period.

What this means for the global stage
Such large investments have allowed Beijing not only to expand its real production capacity but also to strengthen its influence in international affairs. CSIS analysts advised other countries to respond pragmatically to mitigate potential negative consequences from an expanding technological gap.

Countries’ positions by investment volume:

It is important to note that during the study period large U.S. programs—the CHIPS Act—and part of China’s “Great Fund III,” which ultimately raised about $47.5 billion, were not included.

Why China remains lagging for now
Despite massive investments, data from the Semiconductor Industry Association (SIA) for 2025 show that American chip manufacturers hold a 50% share of the global market, while Chinese firms account for only 4.5%.

Among contract fabs, the third largest is SMIC with 6% of the market by mid‑2025, trailing leaders TSMC and Samsung.

SMIC’s yield rates on 5 nm (20%) and 7 nm (46%) process nodes are significantly lower than competitors: Intel, Samsung, and TSMC operate at 2 nm and achieve up to 90% output efficiency.

China lacks access to key EUV lithography equipment from ASML, and attempts to develop reverse‑engineered solutions have so far been unsuccessful—no EUV‑based chip has been produced in the country.

Lagging in design enterprises
In the graphics processor market Nvidia holds a 90% share. Chinese equivalents (Huawei Ascend, Alibaba T‑Head, Cambricon, Moore Threads) lag in performance.

Meanwhile U.S. companies invest an average of 17.7% of revenue in R&D, whereas Chinese firms invest only 9.2%.

The “Great Fund III” program launched in 2024 aims to narrow this gap, but analysts believe that without changes to U.S. sanction policy and increased spending on research and development the situation will remain unchanged: China will continue to catch up with leaders but will not be able to close the technological deficit quickly.