A more serious threat than Huawei and SMIC being sanctioned? SEMI wrote to Biden's government.

In the past two years, under the background of Sino-US trade war, China's leading enterprises in science and technology industry, such as ZTE, Huawei, SMIC, Hikvision and Dahua, have been sanctioned by the US government one after another, which has had a great impact on the development of related industries in China. But today, it is reported that some China media believe that China's chip industry will usher in a new round of "earthquake". ...

What did the news say?

According to the news of Reuters 65438+1October 26th, 65438+1October 25th, Semiconductor Equipment and Materials International Company (Semi) voiced to the new U.S. government-Biden administration, calling for a review of the Trump administration's export control policy, and urging the incoming U.S. Secretary of Commerce to cooperate with allies to restrict the sales of American technology to China on the grounds of national security.

President Sammy criticized the Trump administration's policies and urged the Biden administration to improve them.

SEMI said that the Trump administration's "unilateral regulations may make any potential benefits less effective over time, cause unnecessary harm to the US semiconductor industry, and make American exporters vulnerable to retaliation". On behalf of SEMI, Ajit Manocha, Chairman of SEMI, sent a letter to Gina Raimondo, nominee of US Secretary of Commerce. Ajit Manocha said in the letter: "The United States should act in concert with its allies whose enterprises compete in the global market ... multilateral control of the commodities involved in all major producing countries can create a level playing field, maximize efficiency, and minimize the damage to US national security and economic competitiveness. Ajit Manocha pointed out that more and more foreign competitors use "not subject to US export control" as a means to promote their products (obviously, this harms the interests of American enterprises).

Ajit Manocha's letter also criticized the Trump administration for "rarely consulting the public when implementing relevant regulations, and there is no clear overall policy. This "extremely unusual process" has led to unexpected consequences. " In the letter, Ajit Manocha urged Gina Raimondeau to quickly correct a regulation introduced in August last year. This is the provision of "extreme sanctions" against Huawei that China people are familiar with. It expanded the power of the United States to restrict foreign companies from selling products to Huawei, and affected some foreign-made semiconductor production and testing equipment. It also asked the Biden administration to quickly reduce the backlog of license applications, saying that the delay was actually a refusal.

In addition, the letter also pointed out that the regulations restricting the sale of products and technologies to more than 65,438+000 entities that the United States considers to be associated with China's military came into effect without consulting the industry. SEMI suggested that the United States cooperate with the Netherlands, Germany, Britain, Japan and South Korea to set the same goal in restricting the export of semiconductor technology to China.

Good or bad? This seems to be a good thing.

Judging from the contents of the letter, in fact, many aspects should be good for domestic related enterprises. It criticized the Trump administration's relevant semiconductor industry trade policies, including measures to sanction Huawei. It requires Biden's government to quickly reduce the backlog of license applications, which, if adopted, may help relevant enterprises in China to obtain corresponding supply chain support. It criticizes the US government's MEU (military end-user) list policy, and may also help related restricted China enterprises to restore some supplies.

Some readers may remember two semi-related events that happened in August and September last year.

Second, after the news that the US government was considering sanctioning SMIC began to spread in early September, 2020, on September 16, SEMI warned the US government that if SMIC, a China chip manufacturer, was included in the "entity list", the US semiconductor industry would suffer losses of $5 billion every year. SEMI said that $5 billion of semiconductor equipment and materials revenue comes from SMIC every year, and the inclusion of SMIC in the "entity list" will make it more difficult for relevant American companies to supply the former, thus affecting the global market share of American semiconductor companies.

These two things can show that SEMI represents the interests of the industry and makes a rational voice for the relevant policies and measures of the US government. This rationality, to a great extent, should be beneficial to the semiconductor industry in China.

Yes, a good thing may turn into a bad thing.

On the one hand, the voice of criticism is that SEMI's proposal of "the same goal" may have another meaning, which may bring the expectation of "a new round of" earthquake "in China's chip industry.

Let's learn more about SEMI first.

According to public information, SEMI is a global professional trade association in the high-tech field, established in 1970, with more than 2,000 member companies. Members are companies engaged in development, production and technical support in the fields of semiconductors, flat panel displays, solar photovoltaic, nanotechnology and micro-electromechanical systems. SEMI has opened 1 1 representative offices in North America, Europe, Russian Federation, Japan, China and Taiwan Province Province of China. Its main purpose is to help member enterprises explore world market opportunities, strengthen contacts with customers, industries, governments and business leaders, and strive for the sustainable growth of the industry and serve all aspects of the manufacturing supply chain.

It can be said that SEMI represents the interests of members of the global semiconductor industry. For the United States, which pursues the concept of small government and big society, SEMI, an industry association, can exert great influence in the industry. This can also support OFweek's analysis. SEMI represents the interests of the industry and makes a rational voice.

However, the long-term result of rationality may also be unfavorable to China's semiconductor industry.

In the Trump era, the American government under his leadership pursued an isolationist policy. Under the guiding spirit of "America first", the relationship between the United States and a large number of traditional allies has been hit to varying degrees. As a result, in the trade war with China, many times the United States is "fighting alone." This can be understood as Trump's conceit of American strength, and it can also be understood that the United States is relatively more "single-handed" in this process.

The newly appointed Biden administration also regards China as its "biggest competitor", but unlike the Trump administration, Biden said that he would resume cooperation with traditional allies to meet the "challenge" brought by China. Well, it may turn into a bad thing slowly. ...

Exclusive analysis of OFweek jun

At present, the industry generally believes that the semiconductor industry is in the third wave of diffusion, and the biggest beneficiary of this diffusion will be China. If it is promoted without restriction, China's semiconductor industry will make long-term progress and get more investment and help from international cooperation.

However, the long-term trade conflict between China and the United States may hinder the spread of this wave, build a dam, divert the big wave to other countries and regions, or stay in the United States.

Under the premise of SEMI's rationality and Biden's government's cooperation with traditional allies, American semiconductor industry enterprises are more likely to slowly complete the above-mentioned "embankment-building" task without seriously damaging the interests of their own semiconductor enterprises as during the Trump administration.

We should know that in the process of sanctioning Huawei's "entity list", especially after the announcement of "extreme sanctions" measures in August 2020, the industry has been criticizing the Trump administration for approving the licenses of some American companies, but rejecting the license applications of other allies. This practice has obviously brought about conflicts of interest between the United States and its allies.

Biden's new administration may devote itself to solving this problem, strengthen cooperation with its allies, and * * * meet the "challenge" brought by China.

However, there are still many aspects to be seen in the future development prospects of China's semiconductor industry.

In the context of the global spread of the COVID-19 epidemic, according to The New York Times, in 2020, China surpassed the United States for the first time and became the largest foreign direct investment destination in the world.

According to the data released by the United Nations Conference on Trade and Development, the foreign investment of the United States in 2020 was $654.38+03.4 billion, down by 49%. At the same time, due to mergers and acquisitions and investments in high-tech fields in China, China's foreign investment has reached US$ 654.38+063 billion, an increase of 4%. This will help China to surpass the United States as the world's largest destination for foreign direct investment for the first time against the background that the global total foreign direct investment will drop by 42% in 2020.

In this context, it remains to be seen what impact the attraction of China market itself will have on the above-mentioned "dike building" action and the third wave of semiconductor industry diffusion.

Content source: OFweek electronic engineering network