Against the backdrop of the deep penetration of the digital economy and the restructuring of global supply chains, the chip industry has transcended the scope of traditional manufacturing and become a critical domain for technological development and industrial security. In 2025, the global semiconductor market size had risen to $772.243 billion, marking a year-on-year increase of 22.5% (source: industry statistical report). The industry's growth logic is shifting from being solely demand-driven to being driven by both technological innovation and ecosystem reconstruction. As we enter 2026, alongside the widely discussed AI computing power and storage sectors, green manufacturing transformation and independent controllability in core areas have emerged as new focal points for the industry's development, propelling the global chip industry into a high-quality growth stage.
The trend of green transformation in the global chip industry has gradually become evident, with environmental benefits increasingly tied to industrial competitiveness. Driven by carbon neutrality goals, the high energy consumption and emissions in semiconductor manufacturing have gained industry-wide recognition. Green technology innovation and low-carbon production models have become key directions for enterprise development. European entities have taken the lead, with a cross-industry alliance of 58 semiconductor manufacturers and research institutions launching the "Genesis" project, valued at €55 million. This project focuses on environmentally friendly upgrades across the chip lifecycle, targeting areas such as real-time emission monitoring, PFAS alternative materials, and waste recycling. It aims to produce 45 innovations within three years, aiming to reduce water consumption per unit of capacity in wafer fabs by 15% and carbon emission intensity by over 25% (source: publicly available project information). This model of green transformation, guided by policy and driven by technological collaboration, is gradually influencing the global framework for chip manufacturing.
Green transformation is not merely a policy requirement but has become an internal driver for industrial upgrading. From a technological perspective, chip manufacturing is shifting from a singular focus on performance improvement to a dual emphasis on "performance and energy efficiency." Low-power chip design, green packaging materials, and process optimization have become key areas of research and development. In the storage sector, advanced technologies like HBM3E/4 enhance energy efficiency through architectural innovation while reducing energy consumption per unit of computing power. In the logic chip domain, the application of advanced packaging technologies can improve chip performance based on existing processes and reduce energy consumption. Domestic enterprises in China are also actively following the green transformation trend. Some wafer foundries have begun lowering energy consumption and carbon emissions per unit of product by optimizing production processes and introducing energy-saving equipment, aiming to secure a more favorable position in the global green supply chain competition.
The deepening of independent controllability has injected stable momentum into the development of China's chip industry. In 2026, several positive signals have emerged in the domestic semiconductor equipment and materials sectors, with accelerated breakthroughs in core areas. According to announcements on the China Government Procurement Website, domestic manufacturers have successfully won a project for a step-and-scan lithography machine from the Ministry of Science and Technology. Although this equipment is primarily used in packaging, it marks a milestone in the development of domestic lithography machines, raising market expectations for breakthroughs in high-end DUV lithography machines. In the equipment sector, orders for leading domestic equipment manufacturers grew by 20%–30% in 2025 (source: publicly available enterprise information). The localization process for critical components is accelerating, with areas such as bright/dark field inspection and coating/developing equipment becoming focal points for domestic substitution. The overall localization rate is expected to improve in 2026.
The autonomous capabilities in wafer manufacturing and chip design are steadily improving. Between 2017 and 2025, the number of chip design enterprises in China increased from 1,380 to 3,901, with an average annual compound growth rate of 14%. Among these, the number of enterprises with sales exceeding ¥100 million grew at an average annual compound rate of 20%, demonstrating robust development vitality (source: industry statistical data). On the manufacturing front, companies like SMIC and Huahong Semiconductor are advancing the expansion of advanced process capacities. The construction of 12-inch wafer production capacity is accelerating, with mass production capacity for 12-inch wafer fabs in mainland China expected to reach 3.21 million wafers per month by the end of 2026 (source: industry forecast report). Additionally, the competitiveness of domestic enterprises in specialized processes, such as BCD technology, is increasing. For instance, SMIC has raised prices for its 8-inch BCD process platform, reflecting growing market recognition of domestic manufacturing capacity.
Balancing independent controllability with global collaboration has become a crucial topic for the development of China's chip industry. While promoting localization in core areas, the domestic industry has not detached from the global supply chain. Instead, it participates in global division of labor through "complementary advantages." From January to November 2025, China's integrated circuit exports amounted to ¥1.29 trillion, a year-on-year increase of 25.6% (source: customs statistics). Among these, chips with 28nm and above mature processes have become the mainstay of exports, gradually gaining substitution advantages in emerging markets such as Southeast Asia and Latin America. This development model of "independent innovation + overseas expansion" not only enhances the resilience of the domestic supply chain but also provides stable support for the global chip market.
Despite the positive momentum, China's chip industry still faces multiple challenges. There remains a gap between advanced processes and the world's top-tier technology. The localization rate for key materials, such as lithography gas, currently stands at only 18%, still far from the 40% target for 2026. Issues like the high cost of third-generation semiconductor chips and insufficient industrial chain collaboration and software-hardware ecosystem adaptation require long-term efforts to resolve. Additionally, the trend of regional restructuring in the global chip industry is evident, and the stability of the supply chain faces external factors such as geopolitical influences, posing tests for industrial development.
Looking ahead to 2026, the chip industry is in a period of dual advancement in green transformation and independent controllability. Technological innovation and supply chain restructuring will continue to shape the industry landscape. For China's chip industry, only by persisting in core technology breakthroughs, strengthening collaboration across the upstream and downstream supply chains, actively embracing the green transformation trend, and finding its positioning in the global industrial division of labor can it steadily enhance its core competitiveness. With sustained policy support and the continuous release of enterprise innovation vitality, the "China Chip" is poised to achieve higher-quality development amid the transformative waves of the global chip industry, providing robust support for the sustained prosperity of the digital economy.
