Shanghai authorities increased the capital of the venture fund responsible for import substitution to $2 billion

It was previously reported that at the end of last year, government assistance to Chinese companies in the semiconductor sector and in the high technology sector in monetary terms increased by 35% compared to 2022. Municipal authorities of large cities also provide support. Shanghai, for example, has raised about $2 billion to finance promising developments on its territory.

Image Source: SMIC

As the South China Morning Post notes, the Shanghai Semiconductor Industry Investment Fund (SSIIF) venture fund has been operating in one form or another since 2016, at first it was used to support large players in the semiconductor sector by Chinese standards, such as contract chip manufacturers SMIC and Hua Hong Group , as well as their subsidiaries and contractors. Silicon wafer cleaning equipment manufacturer ACM Research also benefited from the fund’s support.

At the second stage, various types of state and municipal structures invested their funds in this fund; by 2022, it already had about $1 billion in funds. According to the source, this amount was recently doubled, and a separate Shanghai Integrated Circuit Parent Fund was established within the fund’s structure, which will oversee the development of competencies related to the production of chips and equipment for their production. The tasks of the new structure will also include searching for investors among private Chinese companies.