China Turns to Stock Markets to Fund AI as CXMT Raises $9.8 Billion

* Editor's note: AI PRISM (Personalized Report & Insight Summarizing Media) is an AI-based personalized news recommendation and summarization service developed with support from the Korea Press Foundation. It selects and provides six tailored news items for each reader type.

1. China Secures AI Investment Through Listings as State Investors Prop Up Stock Market

- Key summary: Chinese authorities are raising funds in the country's $28 trillion (about 39,645 trillion won) capital markets to narrow the gap with the United States in AI, Bloomberg reported on the 10th. In a leading example, China's largest memory chipmaker, ChangXin Memory Technologies (CXMT), listed on the Shanghai Stock Exchange's STAR Market on the 27th of last month and raised $9.8 billion, the second-largest public offering ever on China's mainland exchanges, with its closing price soaring 466% on the first trading day.

Analysts say the strong showing was underpinned by sweeping government support, including an initial public offering (IPO) fast-track and a pilot preliminary review system. Signs also emerged that state-run institutions were stepping in to defend the market, with China Reform Holdings and Chengtong Holdings injecting 60 billion yuan (about 12 trillion won) using a special re-lending program a week before CXMT's listing.

2. Big Tech Faces Rising Interest Pressure on 'Astronomical' Investments; Treasury Vows to 'Mobilize All Available Tools'

- Key summary: Wall Street says U.S. Treasury Secretary Scott Bessent is mobilizing all available policy tools to bring down long-term U.S. Treasury yields. Market anxiety had grown after the yield on the 30-year U.S. Treasury note rose to as high as 5.28% intraday on the 31st of last month, a roughly 19-year high since July 2007. In its Quarterly Refunding Announcement (QRA), the Treasury changed wording on the "increase" it was considering in the issuance of coupon-bearing notes and floating-rate notes (FRNs) to a review of a "change," while also pursuing joint U.S.-Japan yen-buying intervention and drawing supporting fire from Federal Reserve Chair Kevin Warsh.

Meanwhile, according to the Financial Times, Google had to shoulder interest rates of up to 9.3% a year to fund data centers using Nvidia AI chips. Even this was arranged through structured finance, in which private equity funds (PEFs) and clients set up special purpose vehicles (SPVs) to arrange and guarantee funding. Under this arrangement, the debt does not immediately show up as a liability on the balance sheet, but it could become a contingent liability if markets deteriorate.

3. Under 'Neijuan,' Only 4 of 130 EV Firms Turn a Profit; Anti-Dumping Disputes Also Top the World

- Key summary: Critics argue that China's subsidy policy has produced global heavyweights while at the same time spawning a large number of firms that cannot survive without government support. Kim Han-sol, a senior researcher at the Korea Automotive Technology Institute, said that of roughly 130 Chinese EV makers as of 2024, only four turned a profit: BYD, Tesla China, Li Auto and Geely. AlixPartners estimated that just 15 firms, or about 12% of the total, will be financially viable by 2030.

Cumulative losses at China's top eight solar manufacturers also reached 62.9 billion yuan (about 13 trillion won) from 2024 through the end of September 2025. In addition, since South Korea's Trade Commission under the Ministry of Trade, Industry and Energy was established, anti-dumping investigation requests targeting Chinese products totaled 124 through the first half of this year, accounting for 30.7% of the total and more than double the 59 filed against Japan, which ranked second.

4. Auto and Solar China Shock, Backed by 100 Trillion Won in Subsidies

- Key summary: China has poured more than 100 trillion won in subsidies into its solar and auto industries over the past decade. An analysis by The Seoul Economic Daily of the Organisation for Economic Co-operation and Development (OECD) subsidy data from June found that from 2015 to 2024, the Chinese government paid $14.896 billion (about 21 trillion won) to solar cell and module firms and $57.369 billion (about 82 trillion won) to automakers.

Over the same period, OECD countries' total solar subsidies came to $2.84 billion (about 4 trillion won), just one-fifth of China's, and total auto subsidies among the world's major countries were only about 11% more than China's alone. Park Ki-soon, a professor at the Graduate School of China Studies at Sungkyunkwan University, said a defining feature of China's subsidy policy is shifting its focus according to the market's formation, growth and maturity stages, adding that South Korea also needs to benchmark a performance-linked approach.

5. 'Let's Build the 'Eyes' of Physical AI Together': Sony Forms 9 Trillion Won Alliance with TSMC

- Key summary: Japan's Sony, the world's top image sensor maker, will invest 1 trillion yen (about 8.9 trillion won) to mass-produce next-generation image sensors in partnership with TSMC, the world's largest foundry (contract chipmaker), the Nihon Keizai Shimbun reported on the 10th. The two companies will set up a joint venture within this year, funded roughly 60% by Sony and 40% by TSMC, at Sony's Semiconductor plant in Kumamoto Prefecture, targeting mass production in 2029. The investment is equivalent to four years of capital spending for Sony Group's semiconductor division, and image sensors are expected to serve as the "eyes" in physical AI, the field in which AI controls robots and self-driving cars. Meanwhile, Sony had held a share of around 50% in the CMOS image sensor market, but has been under pursuit since Samsung Foundry won an order for image sensors in Apple's iPhone last August.

6. [Exclusive] 1 Trillion Won-Plus for Water Supply to Southwestern Chip Complex; Government Pushes Feasibility Study Waiver

- Key summary: The government plans to review and approve a waiver of the preliminary feasibility study for a project to expand water infrastructure at a southwestern semiconductor industrial complex, as early as the 25th at a Cabinet meeting, the Ministry of Climate, Energy and Environment said on the 10th. The project consists of raising the Dongbok Dam by 15 meters, installing water conveyance pipes, and building a facility to reuse wastewater from Gwangju's No. 1 sewage treatment plant, with total project costs expected to far exceed 1 trillion won. Of the 650,000 tons of water needed for the complex (excluding reused wastewater), management of the Dongbok Dam, which supplies 300,000 tons, will be transferred from the Jeonnam-Gwangju Integrated Special City to the Korea Water Resources Corporation; shifting to state leadership can cut the dam-raising construction period from 10 years to about three years and 11 months. In addition, Climate Ministry Minister Kim Sung-hwan said there can be no AI without timely supplies of water and electricity, stating a position to expand renewable energy generation capacity to 100 gigawatts (GW) by 2030 and to review building new nuclear plants if necessary.