Asia Express - East Asian ICT
US to Extend Exemption Period for Chip Ban on China
August 25, 2023
The United States recently announced that it will extend its one-year exemption for the export ban on chips to China, allowing semiconductor manufacturers in South Korea and Taiwan to continue introducing semiconductor technology and related equipment in China, the China Daily News reported on August 25. The exemption period could potentially be indefinite. While this move might weaken the US strategy of restricting China in the high-tech sector, it aims to avoid the risk of disrupting the global supply chain to stabilize the US economy before the 2024 US presidential election. 
In October of last year, the US government implemented measures to control chip exports to China, covering logic chips with a process of 16 nanometers or more advanced, DRAM with a process of 18 nanometers or below, and NAND Flash memory chips with more than 128 layers. This one-year exemption was granted to Taiwanese and South Korean semiconductor companies setting up facilities in China. However, this deadline is set to expire in October this year.
According to predictions from the MIC (Market Intelligence & Consulting Institute), the global semiconductor market is expected to experience a 4.1% year-on-year decline, reaching approximately US$556.6 billion in 2023. Additionally, the shipment value of the Taiwanese semiconductor industry is projected to reach NT$41.1 billion (US$1.32 billion) in the same year, representing a 6.9% year-on-year decrease. Established in 1987, MC is a division of the III (Institute for Information Industry), a prominent government think tank and one of the leading IT research institutes in Taiwan.