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Samsung, SK Hynix allowed to export U.S. chip gear supplies to China
CGTN
A memory chip manufactured by SK Hynix. /CFP
A memory chip manufactured by SK Hynix. /CFP

A memory chip manufactured by SK Hynix. /CFP

Samsung Electronics and SK Hynix will be allowed to supply U.S. chip equipment to their China factories indefinitely without separate U.S. approvals, South Korea's presidential office and the companies said on Monday.

"Uncertainties about South Korean semiconductor firms' operations and investments in China have been greatly eased; they will be able to calmly seek long-term global management strategies," said Choi Sang-mok, senior presidential secretary for economic affairs.

The U.S. has already notified Samsung and SK Hynix of the decision, indicating that it is in effect, Choi said.

The U.S. Department of Commerce is updating its "validated end user" list, denoting which entities can receive exports of which technology, to allow Samsung and SK Hynix to keep supplying certain U.S. chipmaking tools to their China factories, the presidential office said.

Once included in the list, there is no need to obtain permission for separate export cases.

The two South Korean companies hailed the move.

"Through close coordination with relevant governments, uncertainties related to the operation of our semiconductor manufacturing lines in China have been significantly removed," Samsung said in a statement.

SK Hynix said: "We welcome the U.S. government's decision to extend a waiver with regard to the export control regulations. We believe the decision will contribute to the stabilization of the global semiconductor supply chain."

Samsung Electronics makes about 40 percent of its NAND flash chips at its plant in Xi'an, northwest China's Shaanxi Province, while SK Hynix makes about 40 percent of its DRAM chips in Wuxi, east China's Jiangsu Province, and 20 percent of its NAND flash chips in Dalian, northeast China's Liaoning Province.

The companies together controlled nearly 70 percent of the global DRAM market and 50 percent of the NAND flash market as of end-June, data from TrendForce showed.

An expert told Global Times that the U.S. was "forced" to take the move.

Given Chinese companies' breakthroughs and capabilities in memory chips, "if the U.S. continues to restrict SK Hynix and Samsung, it means the two companies would have to completely withdraw from the Chinese market and will ultimately be eliminated," Ma Jihua, an industry analyst based in Beijing, was quoted as saying by Global Times.

Ma said the waivers for the two companies will not be the only case. "We will definitely see more … Once we master mature technologies in one area, the U.S. will back down in that area. That is definitely how it will play out."

Recently, the U.S.'s mulling on additional restrictions on semiconductor export to China has also aroused domestic pushback, as Nvidia, Intel and Qualcomm, three of the world's largest chip makers, warned that "a U.S. pullback could accelerate China's development of an independent chip industry, paving the way to a world dominated by Chinese-created chips rather than American-designed chips," the New York Times reported on Thursday.

(With input from Reuters)

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