China is leading the world in building new chip factories, a step toward more self-sufficiency in semiconductors, which could eventually make some buyers rely on China for many essential chips that are currently in short supply, according to the Wall Street Journal.

As global chipmakers race to boost production and ease supply shortages, no country is expanding faster than China, according to chip industry group SEMI. Mainland China plans to build 31 large semiconductor factories－known as wafer fabs－in the four years to 2024.

That beat the 19 from Taiwan, the second-largest chipmaker, and the 12 expected in the U.S. during the same period.

A large portion of China’s projects are aimed at making chips that incorporate older, more mature technologies, rather than cutting-edge processors, the main focus of investment by the world’s top semiconductor companies. When it comes to more complex semiconductors, Beijing has been unable to match chipmakers in the United States, Taiwan and South Korea, and Western restrictions on China’s access to advanced chipmaking machinery have further set it back.

This has prompted some Chinese chipmakers to recalibrate their approach, focusing more projects on low-end chip technology. In doing so, China has the potential to become a powerhouse in this market segment, analysts say. This includes many of the processors that are in greatest demand right now. These include workhorse chips such as microcontrollers that perform countless basic functions, as well as power chips that are widely used in cars, smartphones and other electronics.

“Most electronic products don’t need advanced chips,” said He Hui, research director at Omdia, an industry research institute in Shanghai.

Most of the world’s top chip makers avoid investing heavily in low-end chips because cutting-edge processors bring higher profits and represent the future of the industry. TSMC, the world’s largest foundry chipmaker, recently told investors that its most advanced chips－with transistors of 7nm or smaller－accounted for more than half of its second-quarter revenue. It said it would continue to focus on selling advanced chips.

This leaves a huge market for China. Demand for mature 28-nanometer chips is expected to more than triple to $28.1 billion in the 10 years to 2030, according to consulting firm International Business Strategies Inc. By 2025, 40 percent of global chip production at the 28-nanometer node will be in China, up from 15 percent last year, the company said.

Peter Hanbury, a partner at Bain & Company, a consulting firm specializing in semiconductors, said that raises the question of whether the United States and its allies are investing enough in older chip technology.

As China takes over more supply chains — what it already does for other less sophisticated technologies－it “may increase the importance of non-Chinese production for the rest of the world, especially for these older technologies,” he said.

The U.S., which has relied heavily on chips from South Korea and Taiwan in recent years, has made boosting domestic production a priority. But the effort has hit a snag. Progress on a bipartisan bill that would provide roughly $52 billion in subsidies for U.S. semiconductor manufacturing has been slow as lawmakers sparred over non-chip-related measures tied to the bill. That hurdle has clouded U.S. investment plans for some of the big chipmakers.

The bill, which cleared a procedural hurdle in the Senate last Tuesday, will now be voted on Monday on whether to include it as part of a broader $280 billion package of subsidies and research funding to boost U.S. competitiveness in advanced technologies.

Some chip companies recently said that processor shortages may be easing as demand for PCs and smartphones cools and the cryptocurrency market slumps. Some analysts say China could one day exacerbate potential overcapacity. But executives and other analysts say the shortage is far from over, and demand for more mature chips is expected to remain strong as the market for internet-connected devices and electric vehicles expands over the next few years.

China’s main goal is to reduce its dependence on chips from other countries, especially as tensions between the U.S. and China escalate. In 2017, Chinese chipmakers produced about 13 percent of the chips needed in the country; that number is expected to rise to 26 percent this year, according to International Business Strategies CEO Handel Jones. According to state media, Beijing aims to produce more than two-thirds of its chips by 2025.

China has devoted a lot of resources to this, including two state-level funds, allocating more than 50 billion US dollars to invest in chip projects. Local governments have set up similar funds. Producers of mature chips are eligible for corporate tax breaks for up to 10 years.

Some funds are wasted on projects that never achieve production or run into other issues. China has struggled to find enough engineers to staff its projects. But Chinese fabs for more mature chips may now come online, said Paul Triolo, vice president of China at consulting firm Albright Stonebridge Group.

China’s largest chip maker SMIC is spending heavily to build a fab in local authorities in southeastern Shanghai, focusing on 28-nanometer chips. Not far away, Wingtech Technology launched its automotive chip factory with the goal of producing 400,000 wafers per year.