Composure amid U.S. export control on HBM
Published: 04 Dec. 2024, 19:37
Korean chipmakers find themselves directly caught in the crossfire of tech warfare between the United States and China as Washington included high-bandwidth memory (HBM) chips in its latest sanctioning list of semiconductor equipment and components bound for China. As the driver of AI chips, HBM has emerged as the primary revenue for memory majors SK hynix and Samsung Electronics of Korea and Micron of the United States.
The U.S. Department of Commerce’s Bureau of Industry and Security announced its third package of export curbs on Monday to contain China’s advance in chipmaking for weapons and AI applications, including 140 in the so-called entity list based in China, mostly chip toolmakers and suppliers to foundries like SMIC and tech company Huawei. Shippers of 24 types of semiconductor manufacturing equipment, three types of software tools and HBM to these entities require permission from the U.S. government.
The new controls also affect chip components and software tools made outside the United States if they are based on U.S. origin of technologies and software. Since Korean chipmakers and equipment makers rely on U.S. technology, they will have to comply with the new rule. SK hynix can avoid the salvo as its supplies mostly head to U.S.-based GPU giant Nvidia. Samsung Electronics is suspected to be owing about 30 percent of its HBM revenue to China.
The Ministry of Trade, Industry and Energy in a statement said the latest U.S. restrictions may “somewhat” influence HBM production in Korea. “But the effect can be eased through diversions in shipments,” the ministry added. Seoul needs not overreact, but its casual response is bewildering, given the weight of HBM and other chips in the country’s exports.
Moreover, Washington has exempted major chip equipment makers — Japan and the Netherlands — from the latest curbs. The New York Times reported that the U.S. government agreed in principle with its counterparts of Japan and the Netherlands to allow them to impose their own rules on exports to China. The two governments have defended their companies through coordination with the U.S. government in advance.
Authorities must come up with their own set of regulations to get our companies exempted from the U.S. rules. Companies must strive to raise their technological sovereignty to lessen the constraints related to original technology and diversify markets to wean off China. The government and companies must up their efforts as U.S. pressure on China is bound to grow.
The U.S. Department of Commerce’s Bureau of Industry and Security announced its third package of export curbs on Monday to contain China’s advance in chipmaking for weapons and AI applications, including 140 in the so-called entity list based in China, mostly chip toolmakers and suppliers to foundries like SMIC and tech company Huawei. Shippers of 24 types of semiconductor manufacturing equipment, three types of software tools and HBM to these entities require permission from the U.S. government.
The new controls also affect chip components and software tools made outside the United States if they are based on U.S. origin of technologies and software. Since Korean chipmakers and equipment makers rely on U.S. technology, they will have to comply with the new rule. SK hynix can avoid the salvo as its supplies mostly head to U.S.-based GPU giant Nvidia. Samsung Electronics is suspected to be owing about 30 percent of its HBM revenue to China.
The Ministry of Trade, Industry and Energy in a statement said the latest U.S. restrictions may “somewhat” influence HBM production in Korea. “But the effect can be eased through diversions in shipments,” the ministry added. Seoul needs not overreact, but its casual response is bewildering, given the weight of HBM and other chips in the country’s exports.
Moreover, Washington has exempted major chip equipment makers — Japan and the Netherlands — from the latest curbs. The New York Times reported that the U.S. government agreed in principle with its counterparts of Japan and the Netherlands to allow them to impose their own rules on exports to China. The two governments have defended their companies through coordination with the U.S. government in advance.
Authorities must come up with their own set of regulations to get our companies exempted from the U.S. rules. Companies must strive to raise their technological sovereignty to lessen the constraints related to original technology and diversify markets to wean off China. The government and companies must up their efforts as U.S. pressure on China is bound to grow.
with the Korea JoongAng Daily
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