ASML Technologies; The Backbone of Taiwan and China’s Semiconductor Growth

Published  January 24, 2023   0
S Staff

The US wants to inflict sanctions on ASML so that it cannot do business deals with China

If we highlight the monopoly market in the economic perspective, the one thing that comes into limelight is OPEC, or the Organization of the Petroleum Exporting Countries. OPEC is spearheaded by the world’s once biggest exporters of crude oil like Iraq, Iran, Kuwait, Venezuela. Now, when we speak of the silicon chips, there is only one firm or an organization that has dominated the international semiconductor market. Although China and Taiwan are leading the semiconductor manufacturing industry they wouldn’t have this fate if they did not license some imperative machinery and technologies from ASML.

The leading global companies that manufacture silicon chips like AMD, TSMC, NVIDIA, and Intel follow similar procedures. As per an exclusive report of Firstpost, all these companies use a large sheet of silicon called wafers, which believe it or not, is made using a special kind of sand. Manufacturers then slice these wafers into thin layers and smaller pieces which are then packaged and programmed according to their use cases. Once the procedure is completed, the packages with silicon chips are then sent to be used in numerous products. Now, the point is what makes ASML unique among all these companies. The ultraviolet lithography technology that is used by other companies for making chips is patented and owned by ASML. In fact, the machines that are used to cut and slice the wafers are made by ASML.

The Firstpost report further added that the latest technology to slice silicon wafers is called EUV or Extreme Ultraviolet lithography. ASML is the only company that has the technology for building chip manufacturing machinery with extreme ultraviolet lithography, and as chip manufacturers have claimed, EUV is the future of slicing wafers. Now, speaking of international silicon business, the US is the recent country that has shown interest. The country is boosting the growth of semiconductor by permitting Intel and TSMC to construct new chip-making units coupled with massive subsidies, tax exemptions and discounts. 

The US specifically tried to foist various kinds of trade and regulation embargoes on countries like Netherlands and Japan so that China cannot grow its semiconductor industry and is deprived of EUV chip-making. This is exactly the reason why the US wants to build an amicable trade relationship with the Netherlands. Also, the country wants to inflict sanctions on ASML so that it cannot do business deals with China. Interestingly, ASML has completely stopped business dealings with China and did not sell any latest EUV machinery, but it is still selling the previous generation DUV machines.