The overwhelming supremacy of Asia in numbers

America has a plan. very ambitious. The first and most immediate goal of its strategy is to avoid at all costs China’s ability to develop the lithography equipment it needs Manufacture highly integrated chips by yourself. And the most effective way to do this is to keep ASML-produced UV lithography (EVL) machines from falling into their hands.

However, the government plan led by Joe Biden in the field of semiconductors has another very important pillar as well: American companies that compete in this industry must invest in their country. On American soil. This way you will kill two birds with one stone. On the one hand, it will reduce its current dependence on Asian integrated circuit manufacturers.

In addition, it will somewhat protect the semiconductor industry from the impact of a possible war between China and Taiwan (from which the United States will not emerge unscathed in any way). By the way It will strengthen its local business fabric. However, neither this nor any other Western country intends to develop the semiconductor industry enough to compete on an equal footing with the Asian giants.

Breaking China is hard. For Taiwan, Japan and South Korea, it is almost impossible

The relationship that the United States at the head of the Western alliance currently has with China is very different from the relationship it has with Taiwan, Japan or South Korea. When it comes to semiconductors, these three countries have very close relations with the West as a whole. In fact, the flow of capital and technology goes in both directions.

Holland, The country that controls ASML, which is the largest manufacturer of lithography equipment on the planet, sells its UVE machines to Taiwan (TSMC) and South Korea (Samsung), and other somewhat less advanced equipment, such as deep ultraviolet (UVP) equipment, also to Japan from among other Asian countries. There is currently none of this equipment, neither SVUs nor UVPs, within reach of China.

However, ASML devices include technology from the United States, such as an ultraviolet light source produced by Cymer, as well as from other countries. Germany, for example, provides, among other resources, the most advanced optics manufactured by ZEISS. It is clear that the development of such advanced machinery is the result of intense international cooperation from which China is currently excluded.

Be that as it may, the same Asian countries to which ASML sells lithography equipment are the same ones that subsequently sell their chips to Western companies, generating this Double the flow of capital and technology Which mentioned a few lines above. However, this in no way means that Taiwan, South Korea and Japan are willing to concede any ground to the West in the integrated circuit market.

Just a week ago, Morris Chang, founder of TSMC, made some remarks that clearly reflect the feelings of Asian countries regarding the policy of regrouping the chip industry that the United States and Europe have been spreading through “chips” campaigns. Science Act and European Chip Act. Taiwan, Japan and South Korea share the same work culture. This is what makes it competitive for this executive, and it is expected that Western countries will not be in favor of it.

Perhaps this is one reason why the semiconductor industry is currently centered around the East China Sea. The numbers leave no room for doubt. Currently in Asia it is manufactured 90% memory sticks, 75% of microprocessors and 80% of silicon wafers. These numbers are amazing. So much so, in fact, that they are completely out of reach of the West in the medium term. In the following table we have divided them by country:

No matter how many resources Western countries invest in the development of the semiconductor industry, the advantage gained by Asian countries from a commercial point of view cannot be overcome in the medium term. Technology is currently very much in the hands of the West, but turning that table requires not only huge sums of money; It also takes a long time.

According to Ignacio Martel de la Plaza, Professor of Electronics at the Complutense University of Madrid and one of the achievers Semiconductor expert and solar photovoltaic cells,” the chip factory takes the most modern not less than four years to be fully functional. New chip factories are being built in Europe and the United States, but also in China, Taiwan, Japan and South Korea.

In addition, the West is opposed to the business culture that Maurice Chang told us about, as well as the huge increase in costs, which is most likely represented by chip manufacturing in Europe and the United States. In the long term, it is impossible to predict what will happen, but in the medium term, Asian countries will continue to lead the semiconductor market. China is one of them.

Cover Photo: ASML

index: Chip War by Chris Miller

In Xataka: Industry in the Hands of TSMC and Asian Manufacturers: Global Chip Production Map