[Asia Economy Reporter Jeong Hyunjin] The Shanghai municipal government in China has introduced a policy that provides subsidies of up to 30% for facility investments in semiconductor materials and equipment, according to reports by the South China Morning Post (SCMP) and others on the 20th.
According to the reports, the Shanghai government announced in the "Notice on the Development Policy of Shanghai Semiconductor Industry and Software Industry" released the previous day that it will provide subsidies of up to 30% of new investment funds within a limit of 100 million yuan (approximately 18.7 billion KRW) for semiconductor equipment and materials projects as well as semiconductor inspection and other post-processing projects. Additionally, subsidies of up to 30% will be offered on investments up to 100 million yuan for projects related to semiconductor electronic design automation (EDA) tools, basic software, industrial software, and security software development.
SCMP evaluated, "This move demonstrates Shanghai's determination to help China overcome U.S. semiconductor sanctions" and "will help solidify Shanghai's position in China's semiconductor industry."
This proactive support from Shanghai aligns with the Chinese government's all-out efforts to develop the semiconductor industry. China is mobilizing direct government investments and exceptional tax benefits to support its domestic semiconductor industry and increase semiconductor self-sufficiency. Shanghai is home to the core production facilities of SMIC, China's largest foundry (semiconductor contract manufacturing) company.
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