China dramatically expanded its imports of chipmaking gear in 2023 as a calculated attempt to support its semiconductor sector and overcome limitations set by the US. Based on official customs statistics, Bloomberg calculated that imports of computer chip-related equipment increased by 14% to around $40 billion, the second-highest amount since 2015. This increase happened in the midst of a 5.5% overall dip in China’s total imports during the same time frame.
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Achieving self-sufficiency in chip manufacturing has been accorded top priority by the Chinese government and the semiconductor industry, especially in light of the difficulties caused by export restrictions enforced by the US and its allies.
The US sees China’s high-tech sector as a possible danger, and these limitations have made it harder for Chinese enterprises to have access to state-of-the-art chipmaking gear.
Chinese Chip Businesses are Making Significant Investments
Chinese chip businesses are making significant investments in constructing new semiconductor production facilities to boost national capabilities and get around export control obstacles. Crucially, these restrictions have restricted Chinese companies’ access to the equipment needed to manufacture the strongest and most sophisticated semiconductors.
Notably, in anticipation of increased export restrictions, China saw a spike in imports from the Netherlands. The Netherlands has enforced regulations that impede Chinese enterprises, such as Semiconductor Manufacturing International Corp., from obtaining the newest equipment for producing chips. Lithography equipment imports from the Netherlands surged by about 1,000% year over year in December, totalling $1.1 billion, as businesses hurried to stock up before this month’s Dutch limitations went into effect.
The US government apparently requested that Dutch business ASML Holding NV stop shipments of some of its cutting-edge machinery to China even before the new limitations went into force. These cancellations happened just before export restrictions on expensive machinery used to make chips were supposed to go into force.
China’s significant investment in chip manufacturing equipment demonstrates its determination to become technologically independent and to get past international barriers. A crucial component of the country’s long-term economic plan continues to be its emphasis on developing a strong semiconductor sector.
The significant rise in imported chipmaking equipment demonstrates China’s will to maintain its leadership in the global semiconductor market in spite of outside obstacles.
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