How is China’s AI sector financed?

研报英文原文证据摘录

How is China’s AI sector financed?

ain’s most constrained

segments, particularly chip design and manufacturing. We illustrate the multi-layered

funding schemes from the central government, local governments and SOEs.

“Big Fund”: From Semiconductors to AI

The National Integrated Circuit Industry Investment Fund (commonly known as the “Big

Fund”) is a core state-backed investment vehicle for China’s semiconductor sector, with

the strategic goal of elevating domestic IC industrial chains to global advanced standards

and fostering world-leading enterprises by 2030. Three fund phases have been launched:

Phases I, II and III were launched in September 2014, October 2019 and May 2024, with

registered capital of RMB139bn, RMB204bn and RMB344bn, respectively. Major

shareholders include the Ministry of Finance, China Development Bank, six major state-

owned commercial banks and leading central SOEs, such as China National Tobacco and

China Mobile.

The focus of investment has evolved progressively across these fund phases. Phase I

prioritized downstream chip manufacturing, packaging and testing to support industrial

chain leaders. Phase II shifted upward to target high-barrier upstream semiconductor

equipment and materials. Phase III has the broadest coverage, focusing comprehensively

on core bottleneck areas. Beyond the traditional semiconductor chain, Phase II has

expanded its investment scope to printed circuit boards (PCBs) and AI industries.

Phase III has accelerated tangible AI capital deployment. In January 2025, it co-

established the RMB60bn National AI Industry Investment Fund with Guozhitou

(Shanghai) Private Equity Fund Management. In early May 2026, it was widely reported

that the Big Fund was in active negotiations to lead the initial financing of Chinese AI