The Biden administration decided to strike a blow against China’s semiconductor industry in October. This policy is expected to continue, with the imminent arrival of the manufacturer Yangtze Memory Technologies (YMTC) on the Entity List, the US blacklist. Such a decision could severely complicate your access to the technologies or parts necessary for your business.
Yangtze Memory Technologies reluctantly joins the Entity List
According to Financial Timesthe U.S. Department of Commerce will add YMTC and several Chinese companies to the entity list by Dec. 18, 2022. While this decision comes two months after the announcement of sweeping U.S. restrictions on semiconductors, it’s no coincidence.
When these restrictive measures were put in place, the United States had drawn up another list, that of Chinese companies to be subjected to enhanced verification. These entities then had two months to try” that they were not engaged in activities that could jeopardize the national security of the United States ».
According to the Biden administration, YMTC has violated several US export controls. The Chinese company is said to have supplied Chinese tech giant Huawei with memory chips for its smartphones, which would go against the restrictive measures adopted by Donald Trump during his tenure as US president. Since 2019, suppliers in the Middle Kingdom and elsewhere are immediately fined if they supply Huawei. It is for this reason that YMTC is expected to join the Entity List soon. The manufacturer will have to obtain licenses to obtain American products, licenses that the Biden administration has already promised are difficult to obtain.
The United States hopes to stop China’s advance in the semiconductor market
Alan Estevez, the Commerce Department’s top export controls official, said ” China had relented and allowed inspections of some companies after a long period of non-cooperation “. After having for a long time prohibited the controls of the American authorities, stock exchange holders and others, on its companies, Beijing finally, at the beginning of December, decided to accept them. A step towards Washington for reasons of peace.
However, with the addition of YMTC to the Entity List, China may be expressing its dissatisfaction. If the United States has nevertheless taken this decision, it is because it fears that the Chinese government will require the company to sell electronic components at a price below their average cost, which would upset the market.
Well before the implementation of these restrictive measures, last October, Xi Jinping announced that the country’s economic development would depend on its technological autonomy. Semiconductors occupy a prominent place in this desire for autonomy, it is one of the products for which the country depends most on foreign countries.
For their part, beyond the arguments presented on the market, the United States hopes that their measures will make it possible to curb Chinese technological expansion. The Biden administration is also in talks with Japan and the Netherlands in an effort to prevent their respective companies from selling advanced chip-making equipment to China.
