China plans $143bn aid package for semiconductor industry

Chinese authorities are developing the largest support package for the semiconductor industry in five years. Its goal is to reduce dependence on foreign supplies, switch to self-sufficiency and mitigate sanctions pressure from the United States in this area. The aid package could amount to 1 trillion yuan ($143 billion), Reuters reported Dec. 13, citing sources. The validity period of this package is not specified. According to the agency, the package will mainly consist of tax breaks and subsidies, which will cover up to 20% of the cost of production. The Chinese authorities plan to put these measures into effect in the first quarter of 2023. For comparison: the CHIPS and Science Act, approved by US President Joe Biden in August, provides for state subsidies of $52.7 billion to localize chip production in the US, as well as tax incentives for manufacturers chips (this measure will cost the US budget $24 billion).