China has been navigating a challenging landscape in its quest for self-sufficiency in the crucial semiconductor industry.

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Summary

As global tensions surrounding semiconductor technology escalate, China has been navigating a challenging landscape in its quest for self-sufficiency in the crucial semiconductor industry. Recent developments in export controls by major players like the US, the Netherlands, and Japan have significantly affected China’s access to advanced chipmaking equipment, prompting a surge in domestic efforts to develop indigenous capabilities. This shift has not only bolstered China’s domestic semiconductor manufacturing but also spurred remarkable growth for its local fab tool industry and suppliers of parts and components.

Ripple effects of export controls: China’s semiconductor equipment sector thrives amid global restrictions

A pivotal moment was witnessed in 2023 as the US implemented updated export control rules, expanding the list of chipmaking tools prohibited from being sold to China. This move has posed substantial hurdles for China, making it increasingly difficult to acquire advanced technology crucial for semiconductor production. Additionally, the Dutch government’s revocation of an export license for sophisticated machines, effectively blocking ASML from selling to China, further worsened the situation. Japan also followed suit by imposing export restrictions on various equipment used in semiconductor manufacturing, aligning with the US’s efforts to constrain China’s access to cutting-edge chip technology.

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