Amid the growing tensions in the global semiconductor industry, the CEO of Advanced Micro-Fabrication Equipment Inc China (AMEC), Gerald Yin Zhiyao, has pointedly addressed the escalating export restrictions by the US. During a significant event at the China Semiconductor Equipment Annual Conference held in Wuxi, he expressed concerns over what he perceives as an overt attempt by the US to undermine China’s advancements in chip-making technology.
Key Insights from the Conference
The Wuxi conference, near Shanghai, drew a significant gathering of industry leaders and professionals. Amidst various insights and discussions, one key highlight was the candid viewpoint of Gerald Yin. He believes that the ongoing and escalating export and investment restrictions imposed by Washington are more than mere trade constraints. For Yin, these restrictions are tactical maneuvers with the end goal of ensuring that China’s semiconductor technology remains several steps behind the forefront of global innovation.
Pointing to the US export restrictions announced last October and the subsequent heightened measures by the Biden administration, Yin highlighted a stark narrative. The latter’s recent plans focus on restricting US investments in specific sensitive sectors in China, with semiconductors topping the list.
“The regulations from last October were, in essence, a revelation of the US’ core intentions – to anchor China’s semiconductor manufacturing to the 28-nanometre realm. This effectively keeps us trailing by at least five generations from the pioneering edge that varies between 3-nm to 14-nm,” noted Yin during his address. This sentiment was shared with a sense of urgency and a call to action, emphasizing China’s inability to accept such impositions.
The Deeper Implications of the US Regulations
The broader narrative presented by Yin paints a picture of a series of aggressive measures by the US, targeting the heart of China’s tech industries. He labels the updated US tech export controls as potentially the most damaging of bans since the commencement of related sanctions against China’s tech giants back in 2019.
Moreover, the successive executive order, which zeroes in on American investments in China’s key sectors – semiconductor, artificial intelligence, and quantum computing, has been dubbed by Yin as the “16th move” in Washington’s series of actions against China.
The specifics of the measures are concerning for industry professionals. For instance, the October rules were formulated with an intent to cap China’s logical chip-making prowess to the 14-nm level, DRAM chips to the level of 18-nm, and 3D NAND memory to a staggering 128 layers. All these regulations were justified by the US on the grounds of potential national security threats and the conceivable military use of avant-garde chips.
The Current Semiconductor Landscape in China
Gerald Yin, with his vast 20-year experience in the US chip equipment sector, offered a unique perspective on the balance of power and dependency in the semiconductor realm. Notably, a significant portion of the semiconductor equipment in Chinese foundries, roughly 85%, originates from foreign countries including the US, the Netherlands, and Japan. This overseas dependence provides significant leverage to these nations.
The dominance of international players in the semiconductor equipment space is evident. Companies from the Netherlands and Japan, in collaboration with the US, wield considerable influence, as observed by Yin, who stated, “The US rallying the support of the Netherlands and Japan underscores their concerted effort to impede our growth.”
Despite these challenges, China’s aspirations in the semiconductor domain remain undeterred. Although local Chinese companies still trail their global counterparts in terms of technological advancement and market share, the motivation to bridge this gap is palpable. The uphill journey towards global prominence is fraught with geopolitical complications and diminishing external technological support.
Challenges and the Road Ahead
The discussions at the conference also shed light on the inherent challenges faced by Chinese equipment. Li Jinxiang, a leading figure from China Electronic Production Equipment Industry, pointed out some of the inefficiencies of domestically manufactured equipment. For instance, the stark difference in performance between the lithography machines from the Dutch giant ASML and local Chinese-made wafer coating and developing machines.
The significance of these machines, especially in the lithography process, cannot be understated. They play a crucial role in processing wafers, applying photoresist material, and subsequently developing the pattern after exposure. However, with the growing expertise and returning US-trained Chinese experts, Yin is optimistic. He envisions a globally competitive Chinese equipment industry emerging within the next few years.
Concluding his thoughts, Yin reiterated his confidence in China’s potential to rise amidst adversities. Leveraging sanctions on chip-making equipment will be counterproductive, he warned. He also clarified AMEC’s brief 2021 listing on a US defense department roster, citing companies supporting the Chinese military, as baseless. It was a sentiment that was later validated when the US “reluctantly” delisted AMEC post “four months of intense negotiations.”
In the midst of this dynamic landscape, the semiconductor industry remains a focal point of global technological and political interest, with countries vying for dominance and innovation.
Read More: