Due to US export restrictions, China stockpiles semiconductor equipment... Netherlands imports increase by 96%

US House China Committee Releases Related Report

A report from the U.S. House of Representatives revealed that China has significantly increased its semiconductor equipment imports from the Netherlands this year. Despite U.S. export control measures aimed at curbing China's "semiconductor rise," China is circumventing these restrictions. This case highlights the limitations of U.S. export controls intended to halt China's semiconductor self-reliance.

On the 14th (local time), the U.S. House Select Committee on the Strategic Competition between the United States and the Chinese Communist Party released a 741-page annual report stating that despite semiconductor export restrictions to China, Chinese companies are purchasing semiconductor equipment from the U.S. and its allies to produce advanced semiconductors.

It was revealed that China exploited the staggered implementation of export controls by global semiconductor equipment powerhouses?the U.S., the Netherlands, and Japan?to import semiconductor equipment domestically. From January to August this year, China imported approximately $3.2 billion worth of semiconductor equipment from the Netherlands, a 96.1% increase compared to $1.7 billion during the same period last year. The U.S. implemented export controls in October last year, followed by Japan in July and the Netherlands in September this year. China took advantage of the regulatory gap in the first half of this year to aggressively stockpile semiconductor equipment. By August, China's total semiconductor equipment imports reached $13.8 billion.

The report pointed out significant loopholes in the semiconductor export control measures targeting China. Previously, the U.S. Department of Commerce banned the export of equipment used to produce semiconductors at 14 nanometers (nm) or below (1 nm equals one-billionth of a meter). However, according to the report, if a Chinese company claims it will operate the equipment on older semiconductor production lines, the equipment can be imported into China. It is also difficult to verify later whether the equipment was used for advanced semiconductor production.

This report was released three months after China's Huawei unveiled the Mate60 Pro smartphone equipped with 7nm-class semiconductors at the end of August. At that time, global attention was drawn to the fact that China succeeded in developing advanced semiconductors using relatively lower-performance equipment.

China continues to increase semiconductor equipment imports in preparation for further strengthening of U.S. semiconductor sanctions. According to an analysis of Chinese customs data by Japan's Nihon Keizai Shimbun, China imported about 63.4 billion yuan worth of semiconductor equipment in the third quarter of this year, a 93% increase compared to one year earlier. Imports of equipment from the Netherlands increased more than sixfold. Imports of lithography equipment, a key semiconductor production tool, nearly quadrupled. ASML, the Dutch semiconductor equipment manufacturer dominating the global lithography equipment market, saw its sales share in the Chinese market reach 46% in the third quarter of this year, up significantly from 14% a year ago. ASML maintains that it complies with export controls while selling lithography equipment.

The market expects Chinese semiconductor companies to place large advance orders anticipating further restrictions on Dutch equipment imports. The U.S. Center for Strategic and International Studies (CSIS) warned, "(Chinese semiconductor foundry company) SMIC's technological capabilities have advanced to the point where even equipment used in older production lines can be utilized to mass-produce advanced semiconductors," adding, "If China purchases additional non-advanced lithography equipment, SMIC's 7nm semiconductor production capacity could further increase."

This content was produced with the assistance of AI translation services.