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Good catch - something for us to fix. The blue is line is China's IC market size and the red is the rest of the world.
For figure 3 (which also seems to be missing the labels), blue bar is IC consumption is China and red is IC production in China.
There's been some interest, including in this forum, in the China investment plans in the IC industry. My colleague and I (at the U.S. International Trade Commission) recently published a working paper on this topic, which can be found at the link below...