The US will ban the supply of 14nm chipmaking equipment to China

Recent revelations by independent experts, who reported that the Chinese company SMIC has actually mastered chipmaking technology comparable to the 7nm process technology, certainly forced the guardians of American interests to take a fresh look at the problem of exporting advanced technologies fromch the United States. The restriction on the export of equipment for the production of chips will be extended to 14-nm technologies; although previously they only concerned more “thin” technical processes.

Recall that the current US export control regulations restrict the supply to China of any equipment or technology of American origin that meets certain criteria, even if we are talking about supplies from third countries. If earlier the section passed according to 10 nm standards, now, as Business Korea reports, the American authorities have decided to expand the restrictions on the 14 nm process technology. The same SMIC started mass production of 14-nm chips last year; but under the new conditions, it may have difficulties with further expansion of production lines.

U.S. Tightening Controls on China Exports of Chipmaking Equipment

South Korean memory chip makers have large facilities in China, but they use more mature lithography than 14nm. If, in the future, US restrictions begin to affect older technical processes; this could complicate the life of Samsung Electronics and SK hynix. On the other hand, the US ban will limit the development of the Chinese semiconductor industry; and therefore in the long run, Korean competitors can benefit from this.

According to some observers, long-term benefits for Korean semiconductor industries may come from U.S. inspections on China. Kim Yang-jae, a stock analyst, stated that "to Korean chipmakers, the U.S. movements are unfavorable in the near term, but good in the long run." Although China has lately increased the use of its own memories in Chinese smartphones and Apple was considering using Chinese businesses' memories, there is still a significant technological difference between China and Korea in the memory sector.