China’s Semiconductor Supply Chain Gains Resilience, Not Full Independence

China has made real but uneven progress toward a more secure semiconductor supply chain. Domestic chipmaking equipment and materials are being adopted more widely, and Chinese policymakers say the industry is moving from isolated technical breakthroughs toward coordination across the full integrated-circuit value chain. 57

The important distinction is between resilience and complete technological independence. China appears better positioned to maintain production and replace some foreign inputs, but the evidence provided does not show that it has eliminated its dependence on foreign technology at the leading edge. Advanced lithography remains a particularly important gap. 23

Where China has made progress

Domestic equipment and materials are gaining ground

The National Development and Reform Commission says the range of domestically produced integrated-circuit equipment and materials is expanding and that their use in manufacturing is increasing. That gives Chinese chipmakers more options when foreign supplies are disrupted. 57

The reported gains are not limited to one type of chip. Chinese officials and industry reporting point to improving capabilities in high-end chip design and manufacturing, as well as differentiated strengths in power semiconductors and compound semiconductors. Progress is also reported in advanced packaging and memory devices. 7

These developments can improve supply security even when a country has not matched every international technology at the cutting edge. A broader domestic supplier base reduces the risk that a single missing tool, material or component will halt production.

The focus is shifting from individual breakthroughs to a complete ecosystem

China’s stated ambition is no longer simply to demonstrate isolated advances in individual technologies. The policy direction emphasizes coordination across design, manufacturing, equipment, materials, packaging, applications, finance and research—a model described as full-chain industrial synergy. 57

That shift matters because semiconductor production depends on interlocking capabilities. A fab needs more than a process recipe: it also requires compatible equipment, materials, software, components, technical support and downstream demand. Building those links can make domestic technologies more usable at commercial scale, even if some individual components remain less advanced than their foreign counterparts.

What the “whole-of-nation” strategy means

The 15th Five-Year Plan covers 2026–2030 and places semiconductors among the fields in which China seeks greater self-reliance. Its broader technology agenda calls for decisive breakthroughs across full chains in integrated circuits, advanced equipment, tools, software and advanced materials. 112

In practice, the approach is intended to concentrate resources from government agencies, research institutions, local governments, financing bodies and companies on core technological bottlenecks. The goal is a more vertically integrated and domestically controlled supply chain, rather than a collection of disconnected firms and research projects. 1

This is a strategic plan and policy objective, not proof that the targeted capabilities have already been achieved. The wording of the plan itself points to breakthroughs that China aims to deliver during the five-year period. 112

The biggest unresolved bottleneck: advanced lithography

Advanced lithography remains a central test of whether China can achieve leading-edge semiconductor independence. Chinese semiconductor executives have called for a coordinated national effort to develop operational domestic lithography systems during 2026–2030. Reporting on the proposal says Chinese institutions have made progress on separate components, including EUV light sources, wafer stages and optical systems, but integrating them into a complete working system remains difficult. 2

That call for a national program is significant because it indicates that component-level advances have not yet translated into a fully operational domestic leading-edge lithography platform. It also shows why a semiconductor supply chain cannot be judged only by chip output or by individual laboratory breakthroughs.

What has improved—and what has not been demonstrated

The available evidence supports a measured conclusion:

• Improved: domestic equipment and materials adoption, supply-chain coordination, and capabilities in selected areas such as power semiconductors, compound semiconductors, advanced packaging and memory. 57
• Under development: a fully integrated domestic ecosystem capable of covering every major part of advanced chip production. 12
• Not demonstrated by the evidence provided: complete independence from foreign technology at the leading edge, including advanced lithography and other critical production capabilities. 23

The NDRC’s description of a “significantly safer” supply chain should therefore be interpreted as a claim about greater resilience and domestic substitution, not as evidence that China can already match every advanced capability held across the United States, Japan, the Netherlands, Taiwan and South Korea. The sources also do not provide a single, independently verifiable percentage measuring China’s overall semiconductor self-sufficiency. 235

Bottom line

China is strengthening the parts of its semiconductor industry that matter for continuity: local equipment and materials, specialized chip categories and closer coordination across the industrial chain. U.S. export controls have increased the incentive to replace vulnerable foreign inputs, while the 2026–2030 plan is designed to mobilize national resources around the remaining bottlenecks. 125

The clearest verdict is greater resilience, not completed autonomy. China’s ability to produce a broad range of chips and substitute domestic inputs is improving, but full leading-edge self-sufficiency—most visibly in advanced lithography—remains a goal for the 15th Five-Year Plan rather than an established outcome. 127