The semi-conductor industry is really diverse and spread out world wide.There is no one country that controls everything, or no one company that controls things.
China is not at the leading edge of the industry. Apparently China dominates the lower and middle parts of the industry making chips.
What China does not have is any company that is a world leading fab or a company who makes state of the art etching machines the lithography.
Essentially the world leaders of that part of the industry, those companies can be counted on one hand.
The world's most prominent fab is Taiwan Semiconductor Manufacturing Company - TSMC, and the gold standard for lithography is ASML of the Netherlands.
The fab, the foundry or factory where the semi-conductor is made, China could just co-operate with private foreign companies to build them. A state of the art fab costs billions, and they go obsolete in a few years. Only companies with the R&D and having cash could afford to build a fab. We can see the opportunity here for the Chinese government to step in with offers of financing.
The etching machines, there are rumours China building their own right now. How advanced hard to say.
