China plans to raise the share of domestically produced chips to 70% by next year.

China is strengthening its own semiconductor industry

Since the early 2020s Chinese chip fabrication plants have been unable to use the latest foreign equipment. Nevertheless, the government actively supports the development of the domestic sector by setting specific import substitution targets.

* Localization goals

- In the next year the share of Chinese equipment in the production of “mature” technologies (i.e., those already at mass‑production stage) should reach 70 %.

- Already now new factories are required to be equipped with at least 50 % local equipment; the higher the localization, the larger the subsidies a project receives.

* Technological progress

- Chinese companies plan to move to 14 nm channel‑size chip production using their own equipment.

- In lithography there is significant growth in domestic firm activity:

* SMEE is beginning verification of exposure equipment based on 28 nm wavelength lasers (using argon fluoride).

* Naura Technology has started mass production of etching systems for 28‑nm chips.

* AMEC is working on certifying its equipment for producing 14‑nm ICs at SMIC sites.

* EUV scanners and future plans

- At the end of last year a prototype EUV lithography scanner was assembled in China, using components from former Dutch ASML scanners.

- Chip production with such technology is planned by 2028, although a more realistic deadline is the end of the decade.

- Validation of Chinese equipment often proceeds faster than that of Western counterparts; sometimes everything is completed within one year.

* Software

- In addition to hardware, China actively replaces foreign CAD/EDA packages with its own solutions, which are becoming an integral part of the production chain.

Thus, the government sets concrete numbers for localization and simultaneously creates conditions for rapid adoption of new technologies, including EUV scanners and 14‑nm lithography.