Nikkei:

What measures has China taken in the past five years to improve the industrial chains for integrated circuits and semiconductors? How do you expect the level of China's self-sufficiency in semiconductors to improve by 2025? By approximately what percentage?

Tian Yulong:

Thank you for your questions. The integrated circuit industry has attracted global attention, and the CPC Central Committee and the State Council have attached great importance to it. In 2020, the State Council released policies on promoting the high-quality development of the integrated circuit and software industries in the new period, and put forward many important measures to develop the integrated circuit industry. The MIIT has worked with relevant departments and local governments to actively implement these policies. They have played an important role in the development of China's integrated circuit industry, especially in stabilizing the industrial and supply chains for integrated circuits. This can be seen in three aspects:

First, we have worked with other departments to release the first list of duty-free products for the integrated circuit industry and issued a circular about the conditions for companies to enjoy relevant policies. Domestic and foreign companies will enjoy the policies equally. Our purpose is to support integrated circuit companies of different ownerships to advance the development of the sector. 

Second, we have encouraged technological innovation. We have guided local governments to set up manufacturing innovation centers, improve their technology supply capacity, and speed up the transfer application and commercialization of new technologies, new processes and new equipment in particular. Meanwhile, we have set up relevant standards to promote the application and quality evaluation of integrated circuits, and further increased their application and promotion in automobiles, medical care, energy and other fields to drive the rapid development of the integrated circuit industry via applications and markets. 

Third, we have fostered a sound development environment for the integrated circuit industry. We have given full play to the role of capital in driving industrial development, and guided and encouraged social capital to invest in the integrated circuit industry. In particular, in accordance with various policy requirements, we have strengthened the protection of intellectual property rights and created a market-oriented, law-based and international business environment. The MIIT and the Ministry of Education have encouraged universities to establish the major of integrated circuits as a first-class discipline, build high-level microelectronics colleges, strengthen school-enterprise cooperation, and cultivate high-quality talents. 

The integrated circuit industry is an intelligence-intensive industry. In the future, integrated circuits will continue to be a highly globalized industry, which highlights the importance of strengthening cooperation in global industrial and supply chains. The industries of various countries should strengthen the division of labor and cooperation, so that integrated circuit technologies will continue to develop and the market will keep expanding.

China is the world's largest and fastest growing integrated circuit market, which provides broad market opportunities for the development of global enterprises. At the same time, we have been an important producer and supplier of integrated circuits, and have made continuous contributions to the global integrated circuit industry. Therefore, guaranteeing the stability of industrial and supply chains not only helps support China's self-sufficiency, but also provides resources for global development. We welcome the global integrated circuit industry to increase its investment in China, conduct various forms of cooperation, and jointly contribute to stabilizing industrial and supply chains for the global integrated circuit industry. We will continue to provide good policies and market environments for both domestic and international integrated circuit enterprises, treat all types of market entities equally, offer the same treatment for domestic and overseas investments, and especially enhance intellectual property protection. We will also jointly promote the innovation and development of the integrated circuit industry, and maintain the stability of industrial and supply chains for the global integrated circuit industry. Thank you.

Xiao Yaqing:

I would like to just add one point. As I said, the industry grew 33.3% last year, which represents relatively fast growth. This year, with the advance of industrial digitization and digital industrialization, and the 'increased demand for consumer electronics, we estimate that the industry will have relatively high growth rate among the 31 major manufacturing categories. Mr. Tian mentioned the issue of international industrial cooperation, which is very typical in this industry. We believe this is a major trend and should be adhered to. Thank you.