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China Integrated Circuit Industry Heavily Depends On Import

Research Report on China's Integrated Circuit (IC) Industry, 2013-2017

CRI Report: From January to July in 2013, the total import and export value of China integrated circuit industry reached USD 195.9 billion, increasing by 61% YOY. The total value still maintains fast growth. The export value was USD 59.2 billion, increasing by 159% YOY. The import value was USD 136.7 billion, increasing by 38% YOY. Both of them maintain fast growth rates. The trade deficit was USD 77.5 billion, increasing by USD 1.5 billion YOY. CRI estimates that the total import and export value of China integrated circuit industry will maintain rapid growth, with import value breaking through USD 200 billion and trade deficit breaking through USD 140 billion.

Import is mainly from Asia. - Research Report on China's Integrated Circuit (IC) Industry, 2013-2017

Taiwan is the largest source of China integrated circuit import. Taiwan Semiconductor Manufacturing Co., Ltd., MediaTek Inc. and other Taiwan-funded enterprises play an important role in global integrated circuit market in terms of their sizes and technologies. From January to July in 2013, the import value of integrated circuit from Taiwan was USD 44 billion, increasing by 79% YOY and taking up 32% of total import value. Integrated circuit is the major commodity that causes trade deficit with Taiwan, USD 44 billion trade deficit in 2012 and USD 38.5 billion in January to July in 2013.

From January to July in 2013, the import values from South Korea and Malaysia were USD 25.5 billion and USD 16.8 billion respectively. These 2 countries are the second and third largest source, taking up 18% and 12% of total import value. Other sources of integrated circuit import are the U.S.A., Japan, Singapore, the Philippines, etc.

Trade deficit remains "high level". -Research Report on China's Integrated Circuit (IC) Industry, 2013-2017

Though export value maintains fast growth and successively sets new high records in a few months, the situation that China integrated circuit industry is heavily import-dependent does not have any fundamental change. Based on trade deficit data, the trade deficit of China integrated circuit industry remains USD 10 billion every month and always fluctuates around this value in recent 5 years. Though there was a large fluctuation over the past year, the trade deficit still remained USD 10 billion to USD 12 billion every month.

Integrated circuit is the second largest commodity after crude oil, with regard to the import value. In 2012, the total import value of integrated circuit was USD 192.8 billion, and that of crude oil was USD 220.6 billion. The annual trade deficit reached USD 139.1 billion, which indicated that China integrated circuit industry cannot meet domestic demand in spite of its rapid growth, compared with huge and fast-growing domestic market. Research Report on China's Integrated Circuit (IC) Industry, 2013-2017

Currently, China is the second largest economy in the world and the second largest trading country, as well as the major place of origin and export base of industries of computer, mobile phone, communication device, consumer electronics, etc. in the world. China output volume of major commodities takes up more than 50% of that of the world, computers taking up more than 90%, and mobile phones accounting for more than 70%. According to the statistical data provided by Ministry of Industry and Information Technology, from 2001 to 2012, the annual growth rates of output volume and sales value of integrated circuit industry were all above 20%. The scale of China integrated circuit industry increased to 10% of that of global integrated circuit industry in 2012, though it was less than 2% in 2001. However, the scale ratio between integrated circuit industry and the whole Chinese market is never beyond 20%. If excluding the sales value resulting from OEM (original equipment manufacture) commissioned by foreign enterprises, the degree of self-support of domestic integrated circuit market is less than 10% and the phenomenon that domestic demand for integrated circuit is heavily import-dependent does not have any fundamental change.

Research Report on China's Integrated Circuit (IC) Industry, 2013-2017