Undoubtedly the semiconductor trade is a key issue underlying the US-China commerce battle. However, once we attempt to perceive the power and progress of China’s semiconductor trade, we uncover that every one the figures appear linked and but can’t be in contrast straight. The manufacturing worth of the wafer manufacturing trade shouldn’t be mixed with that of IC design, as the 2 sectors have fully totally different enterprise constructions. Reading the semiconductor trade’s figures is like viewing a rustic’s price range plan, each full of hidden, curious and unanswerable elements.
Basically, the semiconductor trade might be categorized into 4 main areas: wafer manufacturing, IC design, packaging and testing, and upstream tools and supplies. China has been aggressively pushing developments in all 4 fields, however what the nation lacks can also be fairly apparent.
Figures from main analysis companies had been all totally different, however weren’t too removed from one another. IC Insights estimates that worldwide IC demand was US$430.eight billion in 2018 and can rise to US$571.four billion in 2023. Meanwhile, China imported US$312 billion price of semiconductor merchandise in 2018, and its commerce deficit in semiconductors amounted to US$227.four billion within the 12 months. If China’s native IC manufacturing trade’s manufacturing worth of US$23.7 billion is included, China’s demand for semiconductor totaled US$251.1 billion in 2018, accounting for 58.3% of the worldwide semiconductor consumption.
However, the quantity ought to nonetheless be divided when it comes to usages: consumption by the native semiconductor industries and markets, and by manufacturing for international purchasers. Domestic consumption accounted for round 30% of worldwide demand from 2013-2016, however the proportion already elevated to 36% in 2018 or an quantity of US$155 billion because of the aggressive expansions of China’s smartphone distributors globally, in keeping with IC Insights. The 4 main China-based smartphone distributors, Huawei, Lenovo, Xiaomi and BBK had been all within the top-10 rankings when it comes to semiconductor buying in 2018, collectively spending as a lot as US$60 billion.
Semiconductor demand primarily coming from Taiwan and non-China ICT gamers together with Foxconn, Pegatron, Wistron, Quanta Computer, Inventec, Sony, Samsung and LG contributed a complete of US$96.1 billion. That means, of China’s US$155 billion semiconductor demand in 2018, 62% got here from native gamers and 38% from non-China gamers.
(Note: This is a part of a sequence of articles by Digitimes president Colley Hwang on the most recent developments of the IT trade within the wake of the US-China commerce battle.)
