China has launched its third state-backed semiconductor fund, the China Integrated Circuit Industry Investment Fund, with a record capital of $47.5 billion.

The fund, known as 'Big Fund III,' will focus on AI-based semiconductors and manufacturing equipment to boost the domestic semiconductor sector.

Major shareholders include the Chinese Ministry of Finance and China Development Bank Capital.

The fund has previously supported major chip manufacturers in China and plans to hire institutions to invest the new capital.

This move aligns with President Xi Jinping's goal of achieving self-sufficiency in semiconductor technology.

The establishment of the fund has led to a rise in Chinese chip shares, signaling China's commitment to advancing its technological capabilities and reducing external dependencies.