China's Silicon Ambitions: The Quest for Semiconductor Sovereignty

China is accelerating its efforts to ramp up domestic production of silicon wafers amid a surge in global demand driven by the rise of artificial intelligence, according to a report by The Korea Herald. The move aims to secure more than 70% of its advanced silicone wafers domestically by 2026, fortifying its semiconductor supply chain and reducing reliance on foreign sources.

While analysts suggest that China's advancements are unlikely to immediately disrupt the global semiconductor industry, the nation is gradually fortifying one of the essential layers of chip production in response to escalating demands for AI-centric infrastructure. The global market, dominated by major companies like Japan's Shin-Etsu Chemical and Sumco, Taiwan's GlobalWafers, Germany's Siltronic, and South Korea's SK Siltron, remains largely unaffected by China's initiatives.

Determined to leverage local production, China has subtly mandated the adoption of domestically produced 12-inch wafers, with only about 30% of the domestic market accessible to foreign suppliers. Eswin Material Technology, a key Chinese manufacturer, plans to expand its production capacity to 1.2 million 12-inch wafers per month by 2026, aiming to meet 40% of China's domestic demand and secure over 10% of the global market share.

(With inputs from agencies.)