It is no secret that we are in a new Cold War, but this time it is not Russia one of the two parties, but China. In the attempt to maintain commercial hegemony throughout the world and clip the wings of the Asian superpower, The United States has intensified its boycott of China. when it comes to chip manufacturing.
The important thing in the world of chips is not to have the most powerful processor in a benchmark, but to have as many chips as possible with your brand and if you are a State that is a company under your hand that produces them in order to capitalize on the taxes and work. The US plan is regionalization, moving all chip production to US soil, but it is a slow process that involves a process of strategic sabotage of companies from the rest of the world.
The United States continues its boycott of China in semiconductors
Free trade is the best system in the world and one of the ways humanity advances, yet there have always been great superpowers willing to play dirty without considering the consequences for the rest of the world. All this adorned with political propaganda and the attitude of a supranational thug about the nations around him. No country in the world has the power to influence the economic process of others. However, the United States has done so in the case of the Dutch ASML and TSMC in Taiwan.
Well, all of this for our readers is not news, but this time the United States’ attempt to boycott China goes much further than this. It is not that they do not want the Asian superpower not to manufacture the chips under the most advanced nodes using machines with EUV lithography, but now they have gone one level higher. Since the American representatives are looking for that too stop selling DUV lithography equipment to Chinese foundries. In any case, it is not the only company that manufactures them, since they are also made by Canon and Nikon.
This decision will negatively affect the economy of ASML, due to the fact that it sold its machines for the manufacture of DUV chips. to China-based chip foundries such as Hua Hong, SMIC, and YMTC. Which will see their production capacity reduced in the coming years. In any case, it is a response to the fact that they were the largest buyers of this type of equipment in 2020.
What is really happening?
Before all this boycott movement of the United States to China for DUV lithography machines, it must be taken into account that a curious phenomenon is taking place in the design and manufacture of chips. The high price of making them makes it cheaper to split the chip into several different ones and some parts to build with less advanced nodes. Although in general what they fear from the United States is that a phenomenon of technological disruption will take place, where a cheaper product with worse specifications, but which is good enough for common use, ends up displacing the conventional PC in consumption.
Hence China’s boycott of the United States, yet neither of the two superpowers has been able to develop an alternative to ASML within its own borders. Since the Netherlands is a country within the European Union, this is also may compromise trade relations between China and the European Union in a totally globalized market. Although it is true that everything tends towards regionalization, this process will not be done overnight and is rather planned from the US point of view with Intel as a pressure element.
