China's integrated circuit industry logged a record $245 billion in revenue for 2025, marking a 22% year-over-year increase. This surge reflects the rapid scaling of domestic production by Chinese chipmakers, who are filling gaps left by restricted access to advanced U.S. technology.

Since 2020, sales in the Chinese chip industry have nearly doubled. This expansion has elevated China's position in the global semiconductor landscape, bringing its market share to approximately 6%. This places China on par with Taiwan (roughly 6%) and close to Japan and the European Union (about 7% each). In contrast, North America retains a commanding 53% share, while South Korea accounts for 21%.

Key Players Driving Growth

Semiconductor Manufacturing International Corp (SMIC) and ChangXin Memory Technologies (CXMT) are central to this domestic push. SMIC operates as the world's third-largest chip foundry, holding about 5.1% of the global market as of the first quarter of 2026. It trails Taiwan Semiconductor Manufacturing Co Ltd (TSM) and Samsung Electronics Co Ltd.

CXMT ranks as the world's fourth-largest DRAM maker, with roughly 7.67% of the global market. It follows Samsung, SK hynix Inc, and Micron Technology Inc.

ETF Performance and Exposure

Investor exposure to these developments is visible through several exchange-traded funds. The Roundhill Memory ETF (DRAM), which holds CXMT, manages $27.44 billion in assets. It has surged 117.54% both year-to-date and over the past year, despite a negative price trend across short, medium, and long terms according to Benzinga edge rankings.

Other funds show mixed results:

• The Invesco China Technology ETF (CQQQ), holding SMIC, manages $3.19 billion and is down 4.68% year-to-date but up 4.21% over the past year.
• The KraneShares China Technology & Semiconductor STAR 50 Index ETF (KSTR), also exposed to CXMT, manages $397.71 million and has gained 33.25% year-to-date and 65.98% over the past year.
• The Tema Memory ETF (DISK), holding CXMT, manages $85.11 million and has fallen 17.91% both year-to-date and over the past year.

Geopolitical Context

The growth occurs against a backdrop of tightening restrictions from Washington. President Donald Trump's administration has moved to restrict Nvidia Corp's advanced chip sales to China. CNBC's Jim Cramer described this decision as "ill-advised," noting it accelerated Beijing's push for AI self-sufficiency rather than slowing it.

Additionally, the administration recently urged Apple Inc not to source memory chips from Chinese manufacturers amid an AI-driven supply shortage.

What the Numbers Show

The divergence between aggregate industry growth and specific ETF performance highlights sector concentration risks. While the broader Chinese chip industry revenue grew 22%, memory-focused ETFs like DISK fell nearly 18%, whereas DRAM surged over 117%. This suggests that investor capital is flowing selectively into specific sub-segments or companies within the Chinese tech ecosystem, rather than broadly across all domestic chipmakers.

China has adopted a comprehensive legal framework to integrate environmental protection with economic development, marking a shift from fragmented policies to a unified national strategy. The Ecological and Environmental Code, adopted on March 12, 2026, is scheduled to take effect on Aug. 15. This legislation consolidates regulations on pollution control, ecological conservation, and green, low-carbon development into a single statutory pillar.

Legal consolidation and policy shift

The code aims to institutionalize a transformation in China's development philosophy, moving away from the traditional model of prioritizing industrial growth before addressing environmental degradation. By embedding ecological protection into law, the government seeks to provide regulatory certainty for businesses and investors while defining clear responsibilities for local governments.

Key components of the code include:

• Unified legal accountability for environmental violations
• Integrated frameworks for pollution control and ecological restoration
• Mandates for green and low-carbon development across industries

This structural change positions environmental governance not as a separate policy domain but as an organizing principle of economic modernization. The legislation seeks to ensure that ecological, economic, and technological objectives reinforce one another rather than compete.

From 'Two Mountains' to national law

The timing of the code's implementation links directly to the 'Two Mountains' theory articulated by Xi Jinping on Aug. 15, 2005. The principle asserts that 'clear waters and green mountains are as valuable as mountains of gold and silver.' For two decades, this philosophy has guided China's approach to balancing prosperity with preservation.

The new code translates this concept into binding legal standards. It challenges the assumption that developing economies must accept environmental degradation as the price of industrialization. Instead, it frames ecological assets—such as forests, clean water, and biodiversity—as valuable economic resources that can generate livelihoods and attract investment.

Practical applications and resilience

Local experiments, such as those in Anji County, Zhejiang province, have demonstrated how shifting from mining to ecological tourism and sustainable agriculture can create new economic opportunities. The code seeks to scale these models nationally by assigning value to ecological products through mechanisms like carbon markets and green finance.

Beyond environmental benefits, the transition supports national resilience. As a major importer of oil and gas, China faces exposure to global energy market volatility. The promotion of renewable energy, electric vehicles, and energy storage through this legal framework aims to reduce dependence on imported fossil fuels and strengthen energy security.

Implications for the Global South

For developing countries, China's experience offers a reference point for industrializing differently. Many emerging economies face pressure to build infrastructure and create jobs while confronting climate risks. The code suggests that environmental policy can become an integral part of development strategy rather than a constraint.

While not a universal blueprint, the legislation tests whether green development can drive innovation and competitiveness during the industrialization phase. It posits that protecting natural foundations can serve as an engine for long-term prosperity rather than a cost incurred after wealth is achieved.