China's $12 Billion Semiconductor Equipment Purchase Amid US-China Tech Tensions

Thursday, 5 September 2024, 11:00

Semiconductor manufacturing faces seismic shifts as China buys $12 billion worth of chip-making tools amid escalating US-China tech war. The surge in China's chip equipment sales highlights the country's ambition for technological autonomy, challenging global supply chains and geopolitical dynamics. Industry experts note that this strategic investment positions China at the forefront of wafer processing technology.
South China Morning Post
China's $12 Billion Semiconductor Equipment Purchase Amid US-China Tech Tensions

The Semiconductor Equipment Surge

China has emerged as the most significant player in the semiconductor equipment market, showcasing remarkable growth. In the second quarter, sales of chip-making tools, including those for wafer processing, have surged 62% year-over-year, reaching over $12 billion. This dramatic increase reflects China's commitment to achieving self-sufficiency amidst ongoing sanctions.

Global Market Dynamics

  • Global semiconductor gear revenue rose by 4% to $26.8 billion.
  • China remains at the forefront despite sales declines in North America, Taiwan, and South Korea.
  • SEMI projects a continued rise in global sales, predicting a significant $109 billion in revenue by 2024.

US-China Relations Affecting Tech

The escalating demand for semiconductor equipment in China is set against a backdrop of growing tensions between the U.S. and China. The US government has restricted ASML, a leading chip-making firm, from supplying advanced chip lithography machinery to China since 2018, impacting China’s technological advancements.

Future Projections

  1. China is expected to maintain its leading position in semiconductor production through 2025.
  2. Potential sales declines may occur following significant past investments.
  3. Increased tensions could further disrupt technological growth in China.

This article was prepared using information from open sources in accordance with the principles of Ethical Policy. The editorial team is not responsible for absolute accuracy, as it relies on data from the sources referenced.


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