The U.S. appears to be preparing new measures to make it harder for China to produce advanced chips. U.S. lawmakers are calling for broader bans on chipmaking equipment to China after a bipartisan investigation found that Chinese chipmakers had purchased $38 billion of sophisticated gear last year.
The U.S. has imposed strict export controls on advanced semiconductors, chipmaking equipment, and related technologies to limit China’s access to cutting-edge tech, especially in AI and defense. These bans affect not just U.S. companies, but also foreign firms using U.S. tools or software. China’s top chipmakers and research labs have been added to the U.S. Entity List, requiring special licenses for any tech exports.
In response, China is investing heavily in domestic chip production, relying more on older chip nodes, and restricting exports of critical materials like gallium and germanium. Chinese companies are also exploring workarounds, such as using third-party suppliers or optimizing software to reduce reliance on high-end chips.
READ: Alibaba develops new AI chip that could replace Nvidia in China (
According to a report published on Tuesday by the U.S. House of Representatives Select Committee on China, inconsistencies in rules issued by the United States, Japan and the Netherlands have led to non-U.S. chip equipment manufacturers selling to some Chinese firms that U.S. companies could not
The $38 billion was purchased from five top semiconductor manufacturing equipment suppliers, without breaking the law, a 66% increase from 2022, when many of the tool export restrictions were introduced.
The report found that that accounted for nearly 39% of the aggregate sales of Applied Materials, Lam Research, KLA, ASML and Tokyo Electron.
“These are the sales that made China increasingly competitive in the manufacture of a wide range of semiconductors, with profound implications for human rights and democratic values around the world,” the report said.
READ: China rejects Trump’s ‘obsolete’ Nvidia chips despite tariff truce (
Mark Dougherty, president of Tokyo Electron’s U.S. unit, said the industry’s China sales have started to decline this year, in part due to new regulations and welcomed more coordination between the U.S. and Japanese governments.
“I think it’s clear, from a U.S. perspective, there’s an outcome that is still desired that has not yet been achieved,” Dougherty told Reuters in an interview.
These restrictions are reshaping the global semiconductor industry, creating supply chain uncertainties, increasing geopolitical tensions, and potentially driving up tech costs. The chip war is no longer just about technology, it’s about economic power, national security, and global influence.
The ongoing efforts by the U.S. to restrict China’s access to advanced semiconductor technology reflect a broader struggle over technological leadership and global influence.