Taiwan’s semiconductor manufacturing capabilities may be one of the reasons China is invading the island and seizing fabs belonging to Taiwan Semiconductor Manufacturing Co., United Microelectronics and Micron. One potential response to such a plan could be to evacuate personnel and destroy the fab, suggests Parameters, a recent top U.S. military publication. However, according to Taiwan’s National Security Administration, this may not be necessary.
TSMC needs state-of-the-art chip manufacturing equipment from companies such as ASML, Applied Materials and KLA to build chips using cutting-edge process technology. Even if China invaded the islands and occupied TSMC’s fabs without access to advanced equipment and ultra-pure raw materials, China would not only continue to develop cutting-edge manufacturing nodes, but would also continue to produce with current technology. It is impossible to maintain without interruption.
“TSMC needs to integrate global elements before producing high-end chips,” Chen Ming-tong, director general of Taiwan’s National Security Administration, told Taiwan’s lawmakers this week. . bloomberg (opens in new tab)“Without components and equipment like ASML’s lithography equipment, without key components, TSMC would not be able to continue production. […] Even if China got a golden chicken, it would not be able to lay a golden egg. “
China’s slowing economy, tensions with the U.S., and domestic political strife in recent years have prompted China to invade Taiwan, occupy the island, acquire multiple world-class technologies, and boost Xi Jinping’s approval rating. Possibility increased. But possibility does not mean certainty. China must maintain ties with its two key trading partners, the United States and her EU. Moreover, without access to American- and European-designed manufacturing tools and technology, and without funding from trading partners, China’s occupation of Taiwan could turn into a Pyrrhic victory.
new export regulations
US sanctions on China’s supercomputer and semiconductor sector have proven relatively effective. Late last week, the Department of Commerce’s Bureau of Industry and Security (BIS) It was published (opens in new tab) Starting Oct. 12, new export rules impose new licensing requirements on semiconductor manufacturing equipment destined for China.
Under the new rules, US companies must obtain licenses from the US DoC for tools that can create 14nm/16nm node logic chips and below, 18nm node and below DRAM ICs, and 3D NAND chips with 128 layers or more. Fab licenses owned by Chinese companies face a “presumption of denial”, while licenses held by multinationals are determined on a case-by-case basis.
US-based Applied Materials, KLA and Lam Research this week stopped providing suitable tools to Chinese customers such as Semiconductor Manufacturing International (SMIC) and Yangtze Memory (YMTC). These companies have also started to withdraw employees from the YMTC fabs. The decision has already devalued the global semiconductor sector by hundreds of billions of dollars, and it remains to be seen how much it will affect the businesses of Applied, KLA and Lam Research.
Still, the move shows how the US can crack down on China’s semiconductor industry in a matter of days.