Chip war: Japan and the Netherlands are expected to join the US in banning technology exports to China Technology

A Washington official has made the most direct statement to date by a US official, confirming an agreement with Japan and the Netherlands for those countries to impose new restrictions on exports of chip-making tools to China.

“We can’t talk about a deal right now,” Commerce Undersecretary Don Graves said on the sidelines of an event in Washington. But of course you can talk to our friends in Japan and Holland.

Bloomberg reported on Friday that a deal had been finalized, and two people familiar with the matter later confirmed the news to Reuters.

The United States in October imposed sweeping export restrictions on shipments of chip-making tools to China, seeking to curtail Beijing’s ability to expand its chip industry and boost its military capabilities.

For the restrictions to take effect, Washington would have to include the Netherlands and Japan, home to major chip makers ASML and Tokyo Electron.

The Commerce Department said in an email that it will continue to coordinate export controls with foreign allies, calling it a “priority.” “We recognize that multilateral controls are more effective than unilateral controls.

Officials from the Netherlands and Japan were in Washington discussing a wide range of issues at talks on Friday led by White House National Security Adviser Jake Sullivan.

Asked whether a deal on semiconductors had been discussed, President Joe Biden said Friday: “Yes, we talked about a lot of things, but a lot of it is private.”

China’s semiconductor industry has become a major target of US export restrictions. Beijing has spent money to cultivate its domestic industry, but its manufacturing plants, known as fabs, still rely heavily on foreign manufacturing equipment.

SMIC, China’s largest manufacturing plant, makes chips that go into automotive products, Internet of Things devices and some smartphones.

The US placed SMIC on its entity list in 2020 – banning Dutch company ASML from supplying SMIC with UV lithography machines.

YMTC is China’s only player in the global NAND memory market – a hyper-competitive sector long dominated by a handful of companies from the US and South Korea. The company designs and manufactures chips and was added to the US entity list in 2022.

In 2022, YMTC unveiled a chip with 232 layers of memory cells, bringing it closer to rivals like South Korea’s Samsung. Experts say equipment export restrictions are likely to derail further efforts.

CXMT is the only major player in China that designs and manufactures Dram chips, a segment that, like Nand memory, has long been dominated by a handful of companies in the United States, South Korea and Taiwan.

With Reuters

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