After export curbs on Japanese chip-making technologies, the Chinese government has urged Japan to avoid distressing the semiconductor sector. These limits go beyond the ones that the US and its allies have already placed on China in the name of security.
The 23 different kinds of machinery crucial to manufacturing cutting-edge semiconductors used in smartphones, artificial intelligence, and other applications are the focus of the newly imposed Japanese limitations, which went into effect on Sunday, according to The Asahi Shimbun. Beijing's aspirations to grow its tech sectors may be delayed due to the restriction on Chinese access to the equipment required for etching very tiny circuits on chips.
Individual pieces of equipment being exported to China will now need the industry minister's permission, lengthening the export process and, in some instances, creating obstacles that preclude the shipment of these products outright.
Chinese, Japanese Officials Express Concerns
China's foreign ministry spokesperson Mao Ning voiced disappointment with Japan's export prohibitions. She pleaded with Japan to stop these restrictions from interfering with the two nations' regular collaboration in the semiconductor business, per AP News.
Japan's strategy differs from the restrictions the US previously placed on China's access to semiconductors and chip manufacturing technologies. Japan implemented more substantial equipment regulations without expressly targeting Chinese enterprises, in contrast to the US strategy. Though, some Tokyo officials are worried that this strategy might interfere with collaboration and needlessly rile up Beijing.
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Tokyo and Washington have attempted to work together to solve the problem since they are both concerned about China's growth in critical technology. They signed an agreement in May to "de-risk" themselves from potential economic pressure from China together with the other industrial democracies of the Group of Seven.
However, suppose each nation acquires a competitive edge by permitting exports the other country forbids. In that case, different chip-making equipment rules may jeopardize this unity.
The makers of the equipment subject to the stricter requirements have yet to be made public by the Japanese government. However, there are indications that around 10 businesses, including Tokyo Electron Ltd., Nikon Corp., and Hitachi High-Tech Corp., may be impacted. The restrictions do not apply to semiconductor technology used for manufacturing vehicles and appliances.
Tech War Intensifies
In 2022, Japan delivered over 4 trillion yen ($28 billion) of semiconductor manufacturing equipment to China.
Emily Benson, trade and technology project director at the nonpartisan Center for Strategic and International Studies in Washington, closely monitors this subject. Benson underlined that each nation is in charge of its licensing regulations, which may impact how such rules are carried out.
As a key arena in the tech war, Japan's export limitations and foreign policy decisions will impact the global semiconductor industry.
China accused the US and others of trying to sever the semiconductor supply chain. Washington's actions prompted Beijing's WTO complaint in December. On July 3, China said it would start implementing export limits on rare metals gallium and germanium in August, which are used to make advanced semiconductor products.
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