Germany Carl Zeiss, heart of Dutch ASML Lithography Equipment.

Hadoren said:

So I guess the question is - how will those Asian and European companies react? I think that a lot will initially pause sales and then, after careful consideration, conclude that their products contain less than 10% American content.

The question then is how America will react and try to force these Asian and European companies to stop selling to Huawei. Will America try to fine these foreign companies? Will it slap sanctions?

A lot also comes down to the attitude of the governments. How will the European Union, Japan, South Korea, and Taiwan deal with Trump's attacks on their companies?

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That pause in sales from Asian and European companies already happened when Huawei was initially added to the Entity list.

But now they know the % American content in their products, and most concluded they weren't affected at the 25% cap.

I reckon there will be a huge lobbying campaign from foreign governments, in addition to the American companies.
And they will all be making the same points:

Placing Huawei on a sanctions list is only go to slow down the growth of Huawei in the short term.
But in the long-term, this will drive China to create an alternative technology ecosystem.
And with China's population and economy, it can create an alternative ecosystem can be bigger and better than anything in the West.

AndrewS said:

US sanctions to be applied with a new threshold of 10% US content?

So I imagine most technology companies in Europe and Asia are designing out US content.

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Clearly this one is specifically targetting TSMC. Previous TSMC rebuffed US officials about less than 25%, so now US government revised that.

AndrewS said:

That pause in sales from Asian and European companies already happened when Huawei was initially added to the Entity list.

But now they know the % American content in their products, and most concluded they weren't affected at the 25% cap.

I reckon there will be a huge lobbying campaign from foreign governments, in addition to the American companies.
And they will all be making the same points:

Placing Huawei on a sanctions list is only go to slow down the growth of Huawei in the short term.
But in the long-term, this will drive China to create an alternative technology ecosystem.
And with China's population and economy, it can create an alternative ecosystem can be bigger and better than anything in the West.

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From you big general statement , you seems to support China tech independence.
But when I specifically proposed touching foreign assets in China , you immediately got riled up.
Not sure how to make of your conflicting poses. Maybe sowing confusion is the name of your game.

tidalwave said:

I propose taking Intel Fab, you immediately said "Dont touch, Got to maintain good will"
I propose taking TSMC Fab if case it don't supply Huawei, again you said "Don't touch, Got to maintain good will"
i am seeing a pattern here.
Next year, US-CHina tech war continue, and SMIC got banned this time. So, what now??
What would you deal with it if SMIC got banned?? Meaning it wouldn't able to obtain any more US and EU parts.

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Intel and TSMC are amongst the biggest opponents of expanded sanctions against Chinese companies.

China should want to keep them in that position, and they will be in that position if they have fabs located in China.

If SMIC gets banned, then China and the US government have descended into an all out technology war.

But you don't retaliate against Intel or SMIC - who will argue with the US government and want things to go back to the way they were.

There's no way the trade deal just agreed will hold, but that means Trump going into the next election with a US economy in recession.

So I judge the likelihood of a SMIC ban as unlikely, because Trump doesn't want to lose the election.

if TSMC buckles then Taiwan might be reunited with China earlier than we thought. Maybe reunite the koreas too.

AndrewS said:

with a US economy in recession.

So I judge the likelihood of a SMIC ban as unlikely, because Trump doesn't want to lose the election.

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Trump will launch new round of confrontation after he won reelection.

AndrewS said:

Intel and TSMC are amongst the biggest opponents of expanded sanctions against Chinese companies.

China should want to keep them in that position, and they will be in that position if they have fabs located in China.

If SMIC gets banned, then China and the US government have descended into an all out technology war.

But you don't retaliate against Intel or SMIC - who will argue with the US government and want things to go back to the way they were.

There's no way the trade deal just agreed will hold, but that means Trump going into the next election with a US economy in recession.

So I judge the likelihood of a SMIC ban as unlikely, because Trump doesn't want to lose the election.

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I sure seems the chess pieces are all being put in place... If US bans SMIC or strongarms TSMC to cut off Huawei/China, then Xi might pull the rare earth card while it can still be worth something... but then we have this:



Also, tonights impeachment all but guarantees Trumps reelecction.

Keep in mind TSMC Nanjing fab equipments are NonEUV but quite attractive, based on 195nm Excimer ArF laser . It's currently setup for 16nm but capable of extending down to 7nm. They are better than alot of SMIC equipments at the Fab.
If TSMC stop supplying Huawei, taking TSMC equipment is the best consolation Price!

localizer said:

if TSMC buckles then Taiwan might be reunited with China earlier than we thought. Maybe reunite the koreas too.

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Such actions would be a severe over reaction.

At the end of the day, the domestic priority is the physical and economic security of China's citizens.

A war is very risky for China and will definitely set back internal development, along with significant numbers of people dying on all sides.

There's no need for this when in the long run, it will push China faster towards leading edge technology. It's entirely feasible for Chinese R&D spending to increase to 3% of GDP by 2030, in which case China is spending more than the rest of the developed world.

At the same time, China being cut off will slow its economic growth, but won't derail the long term trends which are still very favourable.

But that is not to say that China won't have a long memery about what has happened.

tidalwave said:

Trump will launch new round of confrontation after he won reelection.

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I completely agree.

But that is 1 more year for technology companies to develop alternatives and de-Americanise