Tuesday, December 12, 2023

Europe joins the US in its chip war with China | CNN Business

Hong Kong

Europe’s largest producer of superior chipmaking know-how has joined the US in its escalating standoff with China.

The Netherlands introduced Wednesday, by way of a letter from its commerce minister to parliament, that new restrictions on abroad gross sales of semiconductor know-how had been wanted to guard nationwide safety.

Whereas the letter didn’t identify ASML Holdings, Europe’s largest tech agency, the curbs will have an effect on the Dutch firm, which is a key provider to international chipmakers, together with these in China.

The announcement marks the primary public transfer by the Dutch authorities towards adopting guidelines, advocated by Washington, to limit China’s chipmaking trade.

Japan has additionally been concerned in three-way discussions with the Netherlands and the US, a supply conversant in the talks instructed CNN. Reuters reported that Tokyo is predicted to problem an replace on its insurance policies on chip tools exports as quickly as this week.

China mentioned Thursday it “firmly opposes” the Netherlands’ upcoming curbs, which come simply months after the US restricted gross sales of some semiconductor equipment to Beijing. For these measures to actually chunk, Washington wants different necessary suppliers, situated within the Netherlands and Japan, to affix.

Chinese language overseas ministry spokesperson Mao Ning accused “sure nations” of “coercing and inducing different nations to take export restriction measures in opposition to China on the expense of their allies’ pursuits.”

She didn’t identify the US, however Chinese language officers usually use the time period “sure nations” or “some nations” when making essential feedback about Washington.

“We hope the Netherlands received’t observe some nations in abusing export management measures,” Mao mentioned. “China will take all mandatory countermeasures to guard our official rights and pursuits.”

This week, Chinese language chief Xi Jinping hit out at the US with unusually direct feedback as he referred to as on China’s personal firms to “struggle” alongside the Communist Occasion at a time of mounting challenges. He accused Western nations led by the US of making an attempt to “comprise” and “suppress” China.

Beijing has set a goal for China to change into a worldwide chief in a variety of industries, together with synthetic intelligence, 5G wi-fi know-how and quantum computing.

In October, these plans got here up in opposition to a significant impediment when the Biden administration banned Chinese language firms from shopping for superior chips and chipmaking tools with no license. It additionally restricted the flexibility of Americans to supply help for the event or manufacturing of chips at sure manufacturing services in China.

Chips are important for every thing from smartphones and self-driving vehicles to superior computing and weapons manufacturing.

Veldhoven-based ASML is a worldwide chief within the manufacturing of lithography machines, which make use of gentle to print patterns on silicon. Clients equivalent to TSMC, Samsung

(SSNLF) and China’s SMIC use the Dutch firm’s tools to mass-produce microchips.

“These new export controls concentrate on superior chip manufacturing know-how, together with probably the most superior deposition and immersion lithography instruments,” ASML mentioned in a press release. “On account of these upcoming laws, ASML might want to apply for export licenses for cargo of probably the most superior immersion … techniques.”

It added that it didn’t anticipate the upcoming measures to have a cloth impact on its 2023 monetary outlook. The corporate has primarily offered “mature” merchandise to China.

The announcement of the Netherlands’ export restrictions, the small print of that are anticipated to be confirmed earlier than the summer time, isn’t the primary time the US-China tech rivalry spilled over into Europe.

Two European semiconductor offers bumped into bother final yr over hyperlinks with Beijing, in an indication of concern spreading within the West over potential Chinese language management of essential infrastructure.

In November, the brand new proprietor of Britain’s largest chipmaker was ordered to unwind its takeover, simply days after one other chip manufacturing facility sale was blocked in Germany. Each transactions had been hit by nationwide safety considerations, and had concerned acquisitions by Chinese language-owned firms.

In the UK, Nexperia, a Dutch subsidiary of Shanghai-listed semiconductor maker Wingtech, was instructed by the federal government to promote not less than 86% of its stake in Newport Wafer Fab, greater than a yr after taking management of the manufacturing facility. Staffers have since protested the choice, saying it places practically 600 jobs in danger.

In Germany, the financial ministry barred Elmos Semiconductor, an automotive chipmaker, from promoting its manufacturing facility within the metropolis of Dortmund to Silex, a Swedish subsidiary of China’s Sai Microelectronics.

The failed offers illustrate how, at a time of escalating US-China tensions, Europe can also be below rising stress to behave, significantly as officers face US requires key sectors to be stored out of Chinese language management.

— CNN’s Laura He and Michelle Toh contributed to this report

#Europe #joins #chip #warfare #China #CNN #Enterprise

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