China Imports $5 Billion Worth of Chipmaking Tools: Report

(Image credit: SMIC)

China has seen a remarkable, record breaking surge in semiconductor equipment imports in the recent months, particularly from the Netherlands and Japan, as it braced for the latest export restrictions from U.S. and its allies. This proactive approach is seen to ensure the smooth expansion of its chip production, focusing primarily on advanced and mature process technologies not covered by Western curbs, reports Financial Times.

China's semiconductor equipment imports reached $5 billion in June and July, which is a 70% increase compared to $2.9 billion for the same period a year ago, according to the report that cites Chinese customs data. The bulk of these imports originate from the Netherlands and Japan. The spike is largely attributed to the impending export curbs set by these two nations prompting China to act swiftly to avoid potential disruptions of wafer fab equipment supplies.  

A closer look at the imports reveals that China's focus is on tools such as lithography scanners from the Netherlands-based ASML as well as etching and wafer-coating machines from Japan. These tools were shipped to recognized players like SMIC and YMTC as well as to recently established fabs supported by local Chinese governments.

Both the Netherlands and Japan recently established export limitations on chipmaking equipment, collaborating with the U.S. in an effort to slowdown development of Chinese semiconductor industry. These new measures require Dutch and Japanese companies like ASML and Tokyo Electron to secure export licenses from Dutch and Japanese authorities before shipping their advanced products to Chinese entities. Since such licenses are unlikely to be granted in a prompt manner, Chinese companies preferred to proactively procure the tools they need.

China's strategy appears clear: to sidestep any potential roadblocks in its ambitious chip production expansion plans. The equipment they're bringing in is predominantly geared towards the manufacture of less sophisticated chips, which fall outside the purview of the new Western restrictions. This ensures that China's chip production can continue unhindered despite all odds. 

China was the second largest wafer fab equipment importer in Q1 2023, according to SEMI. Chinese companies procured tools worth $5.86 billion, down 23% year-over-year and 8% quarter-over-quarter. China, Taiwan, and South Korea will continue to be the leading three regions for equipment spending in 2023 and 2024, according to estimates by SEMI.

Anton Shilov
Freelance News Writer

Anton Shilov is a Freelance News Writer at Tom’s Hardware US. Over the past couple of decades, he has covered everything from CPUs and GPUs to supercomputers and from modern process technologies and latest fab tools to high-tech industry trends.