Developing the Chinese Semiconductor Industry Ecosystem

In the Chinese semiconductor industry today, there is a significant imbalance between integrated circuit (IC) demand and the local supply. The most recent available data from China’s General Administration of Customs¹ shows ICs are the country’s leading import (figure 1). Government support to increase local supply is strong via the “Made in China 2025” initiative, with an infusion of funds from various sources of government, local city and private investors as well as cash and tax incentives for reaching key milestones. As China’s local IC ecosystem prepares for rapid growth, we’re seeing new fab construction, capacity increases and other future projects being announced.

If the device roadmap continues along its trajectory, we can expect to see Logic scale to 5nm, DRAM scale to 16nm and NAND enter its fourth 3D generation by 2021². Advanced lithography processes are critical to reaching these milestones, and materials have a critical role in facilitating advanced lithography. Evolutions in photoresist technology have gone hand-in-hand with faster microprocessors and smaller feature sizes, and Dow has played a notable part in this evolution: nine of our photoresists and bottom anti-reflectant coatings (BARCs) were first-to-market solutions.

To compete globally at advanced process nodes, the Chinese semiconductor industry must build out its infrastructure to create a complete local supply chain. In advanced lithography processes, manufacturing requires the tight process control and holistic know-how that can only be achieved through vertical integration and collaboration with global industry suppliers.

However, Chinese semiconductor material companies face many challenges to establish themselves as local suppliers. Time-to-market is critical, and it takes a long time for advanced material development compared with the relatively short period desired by semiconductor manufacturers for product commercialization. The barrier to entry for newcomers is challenging due to high capital investment and high customer adoption risks. They will also need to build up expertise in complex manufacturing, including quality control and raw material management.

Currently, the local material ecosystem of monomers, photoactive compounds/photoacid generators, and functional polymers is limited to support lithography product development and innovation. This is compounded by less-available local talent skilled in areas like formulation, engineering, quality and raw materials. Adding to this complexity, the intellectual property space is already well-occupied.

What can local companies do to overcome these challenges? First, they can make plans now with long-term sustainability in mind. They should invest in all components of the process: advanced manufacturing, improving quality control capability and R&D formulation development. Most importantly, they should be willing to partner with and learn from experienced multinational companies.

To accelerate local electronic material advancement at the government level, China should incentivize foreign materials companies to invest in and build strategic mutually beneficial partnerships. From early on, Dow has established itself as industry leader in a broad range of semiconductor manufacturing materials, including those required for advanced lithography processes. We hope to be able to share our experience with local manufacturers for growth opportunities.

For additional thoughts on growth in China and how materials such as Dow’s solutions for lithography can support this ecosystem, see this editorial from our Litho Technologies Business Director Shuji Ding-Lee, Ph.D.

^{1http://english.customs.gov.cn/newsroom/statisticsdetail/f78db55a-9c8f-4147-a714-3e5403563622}

^{2 http://www.itrs2.net/itrs-reports.html}