Tech war: China appoints new president at state chip fund as Beijing ramps up semiconductor push: report

China’s state-backed semiconductor investment fund, a key institution in Beijing’s drive for greater self-sufficiency in semiconductors, has named a new president as Beijing ramps up its support for the industry amid tough US trade sanctions.

Zhang Xin, a former senior inspector at the Chinese Ministry of Industry and Information Technology, has been tapped as the new president of the China Integrated Circuit Industry Investment Fund Co, also known as the Big Fund, according to a report last week by media outlet Caixin, citing anonymous sources.

The fund, which is the main channel for state support of the chips sector and which raised 138.7 billion yuan (US$20.1 billion) in 2014 and another round of 204.1 billion yuan in 2019, has in the past year been rocked by corruption scandals with several senior executives put under probes by authorities for “suspected serious violations of the law”.

However, the anti-corruption probes have not stopped the flow of funds into China’s favoured projects. For example, the country’s top memory chip maker Yangtze Memory Technologies Co (YMTC), which was added to a US trade blacklist last year, recently received a US$7.1 billion capital boost from state-backed investors, including the Big Fund.

Zhang’s reported appointment comes after Ding Wenwu, the former president of the fund, was put under an anti-corruption investigation on July 30, 2022.

Meanwhile Lu Jun, a former banker and chief executive at Sino IC Capital, the sole management entity of the Big Fund, was expelled from the Chinese Communist Party in January and is expected to stand trial after his case was transferred to the public prosecutor, according to a statement by the Party’s disciplinary watchdog in January.