The three countries are home to the most important companies that produce equipment for manufacturing chips, including ASML, Japan’s Tokyo Electron and California-based Applied Materials.
US equipment makers have complained that the unilateral action by the Biden administration allowed overseas competitors to continue to operate in one of the biggest markets for their products and undermined the aim of restricting China’s military advancements.
Tokyo Electron, which has sold chip-making equipment to China, reversed gains and fell about 1 per cent after Bloomberg’s report.
In addition, China’s offshore yuan reversed earlier gains against the US dollar, weakening 0.1 per cent to 6.7448 after the report. The currency had rallied to the strongest level in two weeks on signs of revived tourism and consumption during the Lunar New Year holiday. Thinner trading has also amplified moves in the foreign exchange market with mainland markets shut.
“This sets the next escalating move in the US-China tech war a bit more meaningfully and could weaken yuan sentiment a tad in the near-term,” said Fiona Lim, a foreign-exchange strategist at Malayan Banking Berhard in Singapore.
Peter Wennink, president and chief executive of Dutch chip machine maker ASML Holding, warns that US efforts against China’s semiconductor industry could have unintended consequences. Photo: Reuters
Even ASML’s chief executive has warned that the US campaign could have unintended consequences. On January 25, ASML president and chief executive Peter Wennink said the US-led export control measures against China could eventually push Beijing to successfully develop its own technology in advanced chip-making gear.
“If they cannot get those machines, they will develop them themselves,” Wennink said in an interview with Bloomberg News. “That will take time, but ultimately they will get there.”
