US lawmakers are calling for broader bans on chipmaking equipment to China after a bipartisan investigation found that Chinese chipmakers had purchased US$38 billion of sophisticated gear last year, including from European giant ASML.
The US House of Representatives’ Select Committee on the Strategic Competition between the United States and the Chinese Communist Party found that China accounts for 39 percent of total revenue for the five leading “toolmakers” — the specialized, highly complex machines needed to produce computer chips.
The report mentioned US companies Applied Materials, KLA Corp and Lam Research, but said that the Netherlands’ ASML and Japan’s Tokyo Electron had substantially increased sales to restricted Chinese entities as Washington imposed stricter controls on US companies’ exports.
Photo: AFP
The committee called for broader bans by the US and its allies on chipmaking tool sales to China, rather than narrower bans on sales to specific Chinese chipmakers.
The US$38 billion was purchased from five top chip manufacturing equipment suppliers, without breaking the law, a 66 percent increase from 2022, when many of the tool export restrictions were introduced.
“These are the sales that made China increasingly competitive in the manufacture of a wide range of semiconductors, with profound implications for human rights and democratic values around the world,” the report said.
The investigation revealed that five Chinese companies restricted by Washington for their military ties were among the top 30 customers of all five equipment manufacturers from 2022 to last year.
They included Semiconductor Manufacturing International Corp, China’s largest chipmaker, and Yangtze Memory Technologies.
“The Toolmakers are selling the forges of future weapons and surveillance tools to the very companies that seek to build [China’s] semiconductor industry into a dominant force,” the report said.
The supply from the companies is crucial to China’s efforts to ramp up its chip industry to beat restrictions imposed by Washington as Beijing looks to keep up in the race toward state-of-the-art artificial intelligence (AI) technology.
The report said ASML sold 70 percent of its advanced deep ultraviolet immersion lithography systems to China last year, up from 26 percent in 2022.
The machines are critical for producing sophisticated semiconductors used in AI and military applications.
“China is attempting to rewrite the entire supply chain,” Foundation for Defense of Democracies senior fellow Craig Singleton said.
“What used to be niche tool segments are now battlegrounds,” he said.
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