SEMICONDUCTOR MARKET watcher iSuppli said that outdated export restrictions by the USA, the UK and 31 other countries are costing chip equipment firms dearly as Chinese fab companies buy the kit through different routes anyway. According to Byron Wu, a senior analyst at iSuppli, the Wassenaar Arrangement restricts the US and the UL from exporting advanced semi manufacturing kit to countries with communist governments, to the Middle East, and to a number of third world nations.
But, said Wu, because Chinese fab capacity is expanding so quickly with 20 200-millimetre and a few 300-millimetre factories set to be complete in the next few years, the manufacturers in the country just buy the kit they need through the back door. That's because the Wassenaar Arrangement is a general set of guidelines and gives no detailed restrictions for specific companies.
The value of the semiconductor kit could be as much as $13 billion, the analyst said.
Examples include Chinese fabs such as SMIC (Semiconductor Manufacturing International Corp), which, iSuppli said, bought major amounts of equipment from the Netherlands and from Sweden, while it also received semiconductor transfers from the Interuniversities Microelectronics Centre in Belgium.
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