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US Official to Urge Japan and Netherlands for More Semiconductor Restrictions on China
A senior US official will travel to Japan and the Netherlands to request increased restrictions on China's semiconductor sector, specifically targeting its ability to produce high-end memory chips essential for artificial intelligence. US Under Secretary of Commerce for Industry and Security Alan Estevez will meet with officials in Tokyo and The Hague, urging them to impose additional limits on the operations of Dutch firm ASML Holding NV and Japan's Tokyo Electron Ltd., both critical suppliers in the semiconductor industry.
This initiative forms part of a continuous dialogue aimed at curbing China's technological advancements. The focus will be on Chinese facilities developing high-bandwidth memory (HBM) chips, which are crucial for AI hardware. Companies such as Wuhan Xinxin Semiconductor, a branch of Yangtze Memory Technologies Co., Huawei Technologies Co., and ChangXin Memory Technologies Inc. are significant players in this sector.
The Biden administration has long sought to restrict China's access to advanced semiconductors, citing national security concerns. Despite these efforts, Chinese companies continue to make notable progress. To enhance the effectiveness of these measures, the US is seeking broader international support, particularly from key equipment providers like Japan and the Netherlands.
Global Restriction Challenges
The US, a major player in the semiconductor equipment market, acknowledges the critical roles that Japan and the Netherlands also play in this industry. According to experts, current export restrictions by these countries lack provisions on servicing, representing a significant gap in the control framework. Estevez is likely to reiterate the US's request for tighter controls not only on exports but also on the maintenance and repair services of advanced equipment in China—a policy the US has already implemented on domestic companies such as Applied Materials Inc. and Lam Research Corp.
Estevez's visit to the Netherlands is anticipated after the new Dutch government is formed, led by Prime Minister Geert Wilders. This government’s stance on US demands is uncertain, particularly as incoming Foreign Trade Minister Reinette Klever has ties to a controversial far-right TV channel and has voiced differing views. The previous Dutch administration showed reluctance to accede to US demands, opting instead to evaluate current impacts and the upcoming US presidential election's outcomes.
HBM Chips and the Semiconductor Supply Chain
HBM chips are integral to AI development due to their ability to expedite memory access. AI accelerators from companies like Nvidia and AMD rely on these HBM chips. The US is reportedly in early discussions about restricting HBM chip exports. Leading producers like SK Hynix, Samsung Electronics, and Micron Technology are essential suppliers in this space, utilizing equipment from ASML and Tokyo Electron. South Korean manufacturers contribute significantly to this supply chain.
Earlier this year, the US requested South Korea to limit equipment and technology sales for advanced chips to China. With the tightening of US sanctions against Chinese tech giant Huawei in 2020, companies such as SK Hynix, Samsung, and Micron halted chip supplies to Huawei, which is now developing its AI accelerators.
Growing Concerns and Legislative Actions
US officials are increasingly concerned about China's advancements in chipmaking equipment. In response, lawmakers have introduced a bipartisan bill to prevent companies receiving US funding for chip factories from purchasing Chinese equipment. This legislative move underscores the ongoing efforts to maintain and extend the technological edge over China in the semiconductor industry.
