Artificial Intelligence
The integrated circuit becomes a "manufacturing power" leading industry to reach the new opportunity of electronic FCC
China's integrated circuit (IC) industry is currently experiencing rapid growth, achieving significant milestones in 2017. According to the latest data from the National Bureau of Statistics, IC production in China reached 156.46 billion units that year, marking an 18.7% increase compared to the previous year. The sector also generated a total revenue of 433.55 billion yuan, reflecting a 20.1% annual growth. By 2020, the industry is projected to surpass 900 billion yuan, with an average annual compound growth rate of 20.8%, showing strong momentum and promising future prospects.
This remarkable development has been driven largely by supportive government policies. In 2014, the term "IC" was first mentioned in the State Council’s government work report, signaling its growing importance. That same year, the State Council released the "Outline for the Development of the National Integrated Circuit Industry," elevating the sector to a national strategic priority. The plan outlined key objectives for the development of the domestic IC industry during the "13th Five-Year Plan" period. In recent years, the integrated circuit industry has continued to be a top focus, positioned as a critical area for accelerating the country’s transformation into a technological powerhouse.
Beyond policy support, the success of China’s IC industry also hinges on the progress of key enterprises. Li Xiaohua, chairman of Shangda Electronics, a leading player in flexible printed circuits (FPC), recalls how Chinese manufacturers were initially absent from the FPC market before 1997. By the early 2000s, more mainland companies began investing in FPC production. In the Pearl River Delta alone, at least 60 companies were involved in building or expanding FPC production lines, mainly located in cities such as Shenzhen, Huizhou, Dongguan, Zhuhai, Guangzhou, and Zhongshan. Similar developments took place in the Yangtze River Delta, where several dozen FPC manufacturers started operations. This surge in investment made FPC one of the most attractive sectors for private enterprises, and Shangda Electronics was established during this time.
However, challenges still remain. As Li Xiaohua points out, the heavy reliance on imported equipment and materials is a major bottleneck that hinders the industry’s independent and sustainable development. He emphasizes that only by enhancing industrial capacity and establishing a self-reliant supply chain can China truly advance its IC sector.
Today, the IC industry is thriving, fueled by rising domestic consumption and industrial upgrades. It is expected to enter a new phase of rapid expansion. According to the National Plan for Promoting the Integrated Circuit Industry, by 2030, the core segments of China’s IC industry will reach international advanced levels, with several companies entering the global top tier. This indicates that the IC industry will remain a central focus of national policy for the next decade or more.
Moreover, as Li Xiaohua notes, over the past few decades, electronic product specifications have largely been set by Japanese and Western manufacturers. However, with China’s massive market demand, many new products now need to be tailored for the Chinese market. This shift marks the beginning of China leading the global market and presents a unique opportunity for the domestic IC industry to reshape the global market structure.
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