Thu. Oct 6th, 2022

Whether the new U.S. President Biden continues the high-pressure line of the Chinese semiconductor industry during the Trump administration has attracted much attention from the outside world. Dealing with the restricted export of Dutch lithography machine giant ASML to China may be the first test the Biden administration will face in the Sino-US technology war.

Bloomberg reported this week that Peter Wennink, president and CEO of Dutch lithography machine manufacturer ASML, said that ASML has so far been unable to export its highest-end products to China: extreme ultraviolet (EUV) because the Dutch government still has not issued an export license. )Lithography.

  

The export of EUV to China has become one of the strategies of the United States trying to join forces with Europe to restrict the development of China’s semiconductor industry.

“There has been a very deep and lengthy discussion between the Dutch, European and U.S. governments on strategies for this technology,” Wenning said. “We don’t expect the fundamental U.S. view of China to change with the new administration. The U.S., as you know, sees China as its biggest competitor.”

Semiconductor chip foundries use EUV equipment to more efficiently produce smaller, more efficient chips. High-end chips are indispensable for the development of artificial intelligence, 5G wireless communication devices, and high-performance computing industries.

China’s most important chip foundry, SMIC, plans to use EUV to produce chip products based on process technology below 7nm.

Liang Mengsong, co-CEO of SMIC, previously stated that SMIC plans to produce the first-generation 7nm process without EUV, but in the future, advanced processes must rely on EUV to achieve this.

Whether the EUV lithography machine can be obtained as soon as possible is extremely critical to the future of SMIC. TSMC and Samsung’s 5-nanometer chips based on EUV process have been mass-produced, and the next-generation 3-nanometer process is about to be trial-produced.

The Financial Times reported in December that some European diplomats said tech companies and EU governments were increasingly frustrated with unilateral U.S. sanctions.

There was news in December that SMIC was seeking to renegotiate EUV equipment with ASML. SMIC reached an EUV purchase order with ASML as early as early 2018. According to Reuters, the Dutch government decided not to renew ASML’s relevant export licenses in 2019 after repeated lobbying by the top U.S. government.

James Mulvenon, director of the intelligence integration department of technology and security consulting firm SOSi, told VOA on the 22nd that since American chipmakers also have close ties with ASML, the new Biden administration may not put too much pressure on ASML’s exports to China.

He said: “I spoke with someone from the new administration team who was familiar with technical issues, and he understood that ASML was a very important company to the (semiconductor industry) ecosystem and didn’t want to punish ASML because we know that the United States is absolutely dependent on them as well.”

Mao Wenjie said companies such as ASML are desperate to get clear instructions from the government: “You can imagine the predicament these companies face, in some cases, their contract products worth hundreds of millions of dollars are parked in the transportation link, waiting for the Ministry of Commerce. Indicate whether permission to ship is obtained.”

High-end EUV manufacturing is currently owned by the ASML family, which currently sells for more than $150 million. ASML’s latest financial report shows that ASML will deliver 31 EUVs in 2020, with a total price of 4.5 billion euros, accounting for 43% of the total annual equipment sales revenue.

ASML EUV buyers are mainly TSMC, Samsung and Intel.

While Chinese companies cannot buy EUV, ASML’s share of sales to China has grown from 12% in 2019 to 18% in 2020. CEO Wen Ningke said ASML’s export of previous-generation deep ultraviolet (DUV) equipment to China is not subject to licensing restrictions.

In December last year, SMIC was placed on the Entity List by the U.S. Department of Commerce. The U.S. Department of Commerce said that advanced technology nodes below 10 nanometers (including extreme ultraviolet technology), the necessary materials needed to produce semiconductors, will be directly rejected for export.

While the U.S. ban does not directly apply to Dutch companies, the Netherlands still has concerns about exporting cutting-edge equipment to China.

Bloomberg commented this week: Although the U.S. restrictions on Huawei in the past two years have received the most attention in the Sino-U.S. standoff, the ASML incident has greater implications for China’s ability to achieve technological self-reliance – as long as China has to import cutting-edge technology, it is still vulnerable. The impact of trade restrictions.

Outside analysts believe that the Biden administration may change some of the ways his predecessors handled U.S.-China relations, but it will still see China as a major competitor in many fields, which is a bipartisan consensus.

In addition, US Secretary of State candidate Blinken expressed his agreement with Trump’s tougher line on China at the Senate Foreign Relations Committee’s approval hearing on the 19th.

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