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Experts Discuss Challenges of Controlling Mature Chips

The U.S. and other governments have so far placed export controls only on advanced semiconductors because they may believe restrictions on a broader, more mature set of chips won’t be effective, experts said this week.

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Chris Miller, associate professor and technology researcher at Tufts University, said policymakers recognize that only “a very small number of companies” can produce the most advanced semiconductors and chip tools, so that’s why they have so far crafted their export restrictions to target those businesses. “As you get into older generation tools, the number of companies that can produce them is broader,” Miller said during an event hosted by the Center for Strategic and International Studies. “And so it's harder to enforce controls.”

Because more companies are involved in the supply chain for more-mature semiconductors, “I think that has led policymakers to hesitate about expanding controls beyond their current pretty narrow focus,” Miller said. They’re worried the controls “might end up hurting Western firms but not actually holding Chinese competitors back if they can find domestic suppliers.”

Andreas Schumacher, executive vice president of strategy, mergers and acquisitions for Infineon Technologies, said it’s a “very reasonable approach” to place export controls on advanced technologies, including chips, for national security reasons. But he said restrictions on semiconductors needed for nonmilitary uses is a more nuanced topic.

“If we were talking about a product which is, in general, needed to run the economy -- the proverbial toaster or washing machine -- the discussion becomes a very different one,” Schumacher said. “Then we get into the question of economic security, or perhaps, really just into the question of free trade, and whether that's more beneficial or less beneficial.”

Miller called it a “challenge” for policymakers. “The question is: where will controls be effective?” he said. “If you're going to impose controls, you want to know if they're going to work.”

Some think tanks and policy experts have said Washington and its allies should restrict exports of lower-level chipmaking equipment to China to prevent Beijing from becoming a global leader in more-mature semiconductors (see 2310270044 and 2311090015).