U.S. set to further tighten chipmaking exports to China
According to Bloomberg, the United States intends to impose even stricter limitations on the export of machinery for the manufacture of semiconductors to China.
The US government reportedly informed US businesses of the plan and informed them that the restrictions might be revealed as soon as next month. According to the report, the Biden government intends to collaborate with Japan and the Netherlands.
The action would further disrupt the chip-making sector, which is already adjusting to regulations put in place in October. These limitations prohibited US citizens from working in China as well as other nations that might represent a threat to national security and demanded export licenses for specific machines. Additionally, there are clauses that restrict the selling or support of technology for particular product categories.
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The administration intends to work with the governments of Japan and the Netherlands, two other important nations for chip manufacturing equipment, in accordance with the most recent rules. Currently, licenses are necessary for the purchase of about 17 of the expensive machines necessary for producing semiconductors, especially if Chinese clients are involved.
When Tokyo and The Hague’s limitations are taken into account, that number is expected to double. The three largest semiconductor equipment producers in the US are Applied Materials, KLA Corp., and Lam Research Corp.
They control the market along with ASML Holding NV of the Netherlands and Tokyo Electron Ltd. of Japan. Building factories with the capacity to produce the most cutting-edge chips is impossible without the availability of their finest products.
US businesses have been compelled to inform investors that losing access to the Chinese market will result in billions of dollars in lost revenue. The Biden administration has pushed Tokyo and The Hague to impose the same restrictions on their businesses in order to level the playing field and close the ring around China’s fledgling chip efforts.
The Dutch government announced earlier this week that it was planning restrictions on specific chipmaking equipment. An additional restriction to those already in place for the most advanced lithography equipment would be placed on the export of so-called immersion DUV lithography products.
The manufacturing of the most sophisticated chips in the world requires this technology. Mao Ning, a spokesman for the Chinese foreign ministry, stated on Thursday that China was adamantly opposed to the limitations because they would “intervene and limit normal economic and trade exchanges between Chinese and Dutch companies.”
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Late last year, the US enacted a number of export controls, one of which barred China from obtaining certain semiconductor chips produced anywhere in the world using US equipment.
There are several areas where US-China ties are strained. Along with technology, the debate between the two factions frequently centers on Taiwan. China does not rule out using force to annex Taiwan because it views it as part of its own land. The US is Taiwan’s largest foreign supporter.
I am a law graduate from NLU Lucknow. I have a flair for creative writing and hence in my free time work as a freelance content writer.