SAN FRANCISCO The U.S. government's refusal to consider a loan application for the export of $769 million of U.S. semiconductor manufacturing equipment to China's Semiconductor Manufacturing International Corporation (SMIC) is a significant development in the relationship between the U.S., Taiwanese and Chinese semiconductor industries and ultimately detrimental to the U.S. semiconductor equipment industry, according to the latest report from the non-profit U.S.-Taiwan business council.
In a statement issued by the council, Council President Rupert Hammond-Chambers called on the U.S. government to do more to support the U.S. semiconductor equipment industry's opportunity in China.
"Since the international competitiveness of U.S. suppliers is tied inextricably to the ability of the companies to provide jobs and increasingly advanced technology solutionsthus maintaining the U.S. leadership position in the industrythe U.S. government should be more supportive of export opportunities such as this," Hammond-Chambers said. He added that non-action by the U.S. government would force SMIC to purchase equipment from Japanese, European, and Korean suppliers.
The Associated Press reported last month that the U.S. Export-Import Bank, a government agency that promotes U.S. exports, still had not agreed to serve as guarantor of a $769 million loan to SMIC. The Export-Import Bank in February effectively rejected a request from SMIC for a $769 million loan guarantee that would have been used to buy chip-making equipment from mainly Applied Materials Inc., according to a report.
The US-Taiwan Business Council said its report, available now, also analyzes the impact of the Taiwan government's decision to postpone further opening of foundry and packaging and testing investment in China's semiconductor industry in light of China's passing of its Anti-Secession Law in March, as well as investigations into alleged illegal Chinese investment by companies like United Microelectronics Corporation (UMC).