As US accelerates efforts to curb China’s semiconductor industry, key countries in the global semiconductor value chain are expecting pressures from Washington to follow suit.
According to reports from Nikkei, Japanese governments officials have been holding internal discussions on the sanction options available, while observing how European countries and South Korea respond to US pressures. Japan is the home to some world-leading semiconductor equipment companies such as Tokyo Electron and Nikon. In 2021, the Chinese market accounted for 27.5% of Tokyo Electron’s revenues. Nikkei also cited leaders in the Japanese semiconductor industry who were concerned that curbs on advanced chip manufacturing in China would also dampen the demand for Japanese semiconductor equipment.
Europe, likewise, has also been under pressure. Bloomberg reported that the US had suggested some European countries to target China, emulating their export control regimes against Russia, as both sides of the Atlantic prepare for their high-level trade forum, the EU-US Trade and Technology Council, in December. The Netherlands, home to lithography equipment leader ASML, has long been the target of Washington’s diplomatic efforts to restrict DUV shipments to China.
Latest Bloomberg reports on November 3 indicated that the US had renewed its diplomatic effort: two senior US officials were expected to visit the Netherlands soon to discuss the issue, even though the Dutch government has been seeking to pursue its own China policy. Unlike EUV tools, DUV equipment is currently not covered by the Wassenaar Arrangement. The current arrangement only covers lithography systems that feature a sub-193nm light source and capable of producing patterns with a minimum resolvable feature size (MRF) of 45nm or less. The Dutch media Bits & Chips reported that the Wassenaar Arrangement would have to be amended to extend its coverage – either by raising the MRF or taking multi-patterning into account. Not to mention that the Arrangement is non-binding.
For Washington, Germany will also be high on its agenda to rally allies behind its chip war against China, as German Chancellor Olaf Scholz embarks on his controversial visit to Beijing – a move opposed by his coalition members in Berlin, but deemed necessary by the German industry, especially the automotive sector. Hildegard Muller, the President of the German Automobile Association, voiced support for Scholz’s China visit, pointing out that business with China secures a large number of jobs in Germany, Deutshce Welle reported. Muller also noted that China is a key supplier of important raw materials that Germany doesn’t have, in addition to being the largest market for German automakers. A Volkswagen representative also told Nikkei Asia that “decoupling from China cannot be the way forward in a highly connected world, pointing to closely-knit supply chains. A dozen top German executives have accompanied Chancellor Scholz on his China visit, among them are the chief executives of Volkswagen, BMW, BASF and Bayer.
The visit comes as Scholz’s coalition government is already mired in divisions on Germany’s China policy. Coalition partners from the Green party and the Free Democratic Party take a harder line against China as Berlin debates the sale of a terminal in Hamburg to China’s state-owned shipping giant COSTO, in addition to the sale of Elmos Semiconductor, a wafer fab based in Dortmund, to China-owned Silex Microsystems.
(Digitimes)
If you have an interesting Article / Report/case study to share, please get in touch with us at editors@roymediative.com/ roy@roymediative.com, 9811346846/9625243429.