Chip suppliers stock go up as the US considers weaker sanctions. Shares of ASML and Tokyo Electron both went up after Bloomberg reported the US is planning on significantly weaker sanctions against Chinese tech companies.
Bloomberg reported on Wednesday that Washington is considering further measures to restrict sales of semiconductor equipment and AI memory chips to China, but that the new rules could stop short of earlier proposals that were seen as stricter.
The U.S. Commerce Department’s Bureau of Industry declined to comment on the Bloomberg report.
The U.S. is now considering adding fewer suppliers to Chinese technology giant Huawei to an export blacklist known as the Entity List. According to the report, one key Chinese firm that won’t be added is ChangXin Memory Technologies, a memory company and potential rival to the likes of SK Hynix and Samsung.
So that’s supposedly a thing. And not a good one.
The United States should be imposing sanctions against China to the highest degree possible. Tech nationalism is the only path forward from now on. There is no going back. The AI bottle has been opened. The use of semiconductors as a weapon of war is prevalent. The future of technology is clearer than you’d think. We are screwed unless we adopt a comprehensive policy of technological nationalism.
Hopefully the Trump Administration will recognize the existential threat allowing ANY equipment to go to China poses. If we can hobble their tech sector, we should. They would do the same to us if they were ahead in semiconductors and this is one of the only things we have going for the United States.
Japan needs to prepare itself for a world where they can no longer sell any equipment or inputs to China. Japanese companies cannot keep selling equipment to a country that is fundamentally against the very foundation of their and the United States’ society. China is a totalitarian nightmare, a real life incarnation of 1984, and we cannot forget that or continue the policy of politeness to them.
At the moment it kind of sounds like the Biden Administration is considering weaker sanction because Japan complained. China is a large customer of Japanese semiconductor production equipment and other semiconductor inputs. Harsh sanctions would have meaningfully hurt these Japanese companies. Afterall, 40% of Tokyo Electron’s sales are to China. So I guess it’s about money.
I am hoping that the Trump Administration not only recognizes the need for the current CHIPS Act but also recognizes the need for a CHIPS Act II and an Electronics Act. Our current system of relying on Taiwan for our semiconductors and China for our finished electronics is not sustainable. Not only is Taiwan prone to earthquakes and under threat from China, China is a threat to the United States. The 1990s dream of world peace is over. Time to wake up.
So ultimately if the Biden Administration really does do weaker sanctions then Tokyo Electron is going to keep selling semiconductor production equipment to Chinese companies and Chinese companies are going to still be able to move forward technologically.