China chipmaker SMIC receives $2bn state help amid Huawei ban

US sanctions accelerate Beijing's drive toward technological self-sufficiency

Tougher U.S. sanctions mean that China relies more on local player Semiconductor Manufacturing International Corp. (Photo courtesy of SMIC)

SHUNSUKE TABETA and KENSAKU IHARA, Nikkei staff writers

May 22, 2020 05:45 JST

BEIJING/TAIPEI -- China's Semiconductor Manufacturing International Corp. will receive a $2.25 billion infusion from state investment funds to underwrite the development and production of chips intended to counter new sanctions levied by the U.S.

Funds run by the Chinese government and the city of Shanghai will inject the capital into an SMIC group company that operates a plant in the city. The transaction, which will occur before the end of the year, will cut SMIC's stake to 38.5% from 50.1%.