China has announced it will be launching a new state investment fund which hopes to raise $40bn for its semiconductor chip sector, as the country falls behind in global generative AI funding.
The new funding is part of what is being called the Big Fund, which features two other funds launched by the China Integrated Circuit Industry Investment Fund.
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China’s newest funding will be aiming to invest in equipment for chip making in order to boost domestic semiconductor manufacturing.
The new fund, which was reported by Reuters citing two people familiar with the matter, was approved by Chinese authorities recently.
According to the publication, China’s finance ministry will be contributing 60bn yuan ($8.2bn). The other contributors were not named.
Export bans on key chip equipment from the US and its allies have led President Xi Jinping to push forward with his goal to make China self-sufficient in its semiconductor manufacturing.
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By GlobalDataSemiconductors are key components for powering advanced AI programs like OpenAI’s ChatGPT.
Chinese tech giants, Alibaba and Huawei, recently showcased new generative AI products in an attempt to rival leading US companies like OpenAI and Meta.
Despite this, China has fallen far behind in generative AI funding so far this year, according to research firm GlobalData’s Deal Database.
In data captured from January 1, 2023 to September 1, 2023, China raised $53bn over 12 generative AI deals.
This is a far behind the US, which is leading globally with a total value of $5.7bn raised in over 138 generative AI deals this year.
Germany's data protection chief announced in August that the banning of ChatGPT may soon be an option, follows the US in total raised value in 2023.
The European country raised $182m over just nine deals, bolstered by a major $100m fundraising round by Cologne-based DeepL, the owner of a leading neural machine translation service that was launched in August 2017.
Our signals coverage is powered by GlobalData’s Thematic Engine, which tags millions of data items across six alternative datasets — patents, jobs, deals, company filings, social media mentions and news — to themes, sectors and companies. These signals enhance our predictive capabilities, helping us to identify the most disruptive threats across each of the sectors we cover and the companies best placed to succeed.
