Posted on 08/05/2022 4:03:24 PM PDT by FarCenter
BEIJING -- China is clamping down on the misappropriation of funds inside the national chip industry as its rivalry with the U.S. in semiconductors heats up and an important Communist Party national congress is just a few months away.
Authorities have launched a barrage of investigations against semiconductor executives in recent weeks. The white collar busts are happening during the run-up to this fall's twice-a-decade Communist Party congress. The timing suggests that the central leadership is frustrated that China's semiconductor industry is not growing as fast as anticipated.
The country's largest state-backed chip fund has become a "hotbed of corruption" according to a report from a Chinese media outlet. The China Integrated Circuit Industry Investment Fund (CICF), which is backed by state-owned banks and other sources, distributes funds to domestic semiconductor companies.
The CICF was meant to serve as a launchpad for the central government's industrial development agenda. But in late July, authorities announced they were investigating Ding Wenwu, the CICF's former president.
Specifics of the probe have not been disclosed, but it is suspected that Ding funneled cash from the fund toward personal expenses.
Ding once worked as the head of the semiconductor policy department within the Ministry of Industry and Information Technology. He was then installed at the CICF, created in 2014.
Known commonly as the "Big Fund," the entity has raised 340 billion yuan ($50.3 billion) to date and invested roughly two-thirds of that amount. Because Ding had a reputation as a heavyweight in the chip industry, the probe came as a shock throughout the sector.
Ding was not the only one in the crosshairs of authorities. In mid-July, Lu Jun, the one-time chief of Sino IC Capital, the CICF's managing company, was placed under investigation. Both Lu and Ding were known to be involved in selecting investment targets. An executive at another fund linked to the CICF has reportedly been placed under arrest.
The investigation has widened to companies that have received CICF funding. Also in July, the former head of Chinese chipmaking giant Tsinghua Unigroup, Zhao Weiguo, was placed under arrest. Diao Shijing, the former co-president of the group, has also been taken into custody, according to a report from Chinese media outlet Caixin.
The CICF has injected funds into Yangtze Memory Technologies Co. and UNISOC, both group companies within Tsinghua Unigroup.
"The crackdowns on the Big Fund and Tsinghua Unigroup are related," said a source, echoing a widely held view. The probe could potentially net more figures going forward.
“Chinese media outlet...”
Reading Xi’s hand scribbled notes...
I’ve read about Xi Jin Ping’s war on “corruption” ever since 2012 when he took over leadership of China.
This question comes to mind — is it really corruption he is concerned with, or competition?
“This question comes to mind — is it really corruption he is concerned with, or competition?”
It doesn’t matter on the corruption vs competition in regards to Xi.
The results will be the same, a crack down on businesses in China.
Reading Xi’s mind is useless, watching his actions is what we will do.
In this case the corruption is correct. The ChiComs have been trying to develop a home grown processor for years. It rips off MIPS technology but they still can’t make it fast.
https://en.wikipedia.org/wiki/Loongson
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