New regulations implemented in Japan to cooperate with US containment equipment | Manufacturing | US

Despite repeated warnings from the Chinese side, Japan's new regulations to cooperate with the United States to contain China were officially implemented on July 23.

According to Kyodo News Agency, the Japanese Ministry of Economy, Trade and Industry began implementing the revised Foreign Exchange and Foreign Trade Law on the same day, adding 23 categories in the cutting-edge semiconductor field as export control objects.

After the implementation of the new regulations, except for 42 "friendly countries and regions" such as the United States and South Korea, 23 categories need to obtain permission from the Japanese Minister of Economy, Trade and Industry every time they export to China and other countries. It is expected that the exports of about 10 Japanese companies, including Tokyo Electronics, to China will be affected.

The report stated that although specific countries and regions were not named, it can be seen that the intention is to "prevent China from using technology for military purposes", and the threshold for exporting cutting-edge semiconductor related products to China has increased.

The report points out that Japan's efforts to exclude China from the semiconductor supply chain, in line with the United States, may further exacerbate global fragmentation.

The Governor of Chang'an Street noticed that in October last year, the US government upgraded its export control measures against China in areas such as semiconductor manufacturing, and requested Japan and the Netherlands to cooperate in the containment of China. In January this year, the United States, Japan, and the Netherlands reached an agreement to restrict the export of some advanced chip manufacturing equipment to China.

At the end of March, the Japanese Ministry of Economy, Trade and Industry proposed a plan to add 23 new types of cutting-edge semiconductor production equipment that are prohibited from export. The plan is to revise the order in May and officially implement it in July.

On May 23rd, the Japanese government officially issued export control measures for semiconductor manufacturing equipment, which will restrict the export of 23 key chip manufacturing equipment from July 23rd, including manufacturing equipment for extreme ultraviolet light related products and etching equipment for three-dimensional stacked storage components, all of which belong to cutting-edge chip products with circuit linewidths below 10-14nm.

On the surface, the Japanese side did not mention China and refused to acknowledge that this move was following the footsteps of the United States, which can be said to be "there is no silver in this place.". "This is not consistent with the measures introduced by the United States in October last year and does not target specific countries," said Japanese Minister of Economy, Trade, and Industry Yasumi Nishimura

Before the official implementation of the new regulations by Japan, China had issued multiple warnings.

On May 26th, Chinese Minister of Commerce Wang Wentao held talks with Yasuhiro Nishimura during the 29th APEC Trade Ministers Meeting in Detroit, USA, and made solemn representations regarding Japan's insistence on introducing semiconductor export control measures.

Wang Wentao pointed out that the Japanese side disregards China's strong opposition and industry opinions, insists on introducing semiconductor export control measures, seriously violates international economic and trade rules, and seriously damages the foundation of industrial development. China is strongly dissatisfied with this and urges Japan to correct its erroneous practices and effectively maintain the stability of the global industrial and supply chains.

On June 2nd, Chinese Ambassador to Japan Wu Jianghao was invited to attend the Japan Association for the Promotion of International Trade and gave a speech, stating that if Japan insists on imposing restrictions on Sino Japanese semiconductor cooperation, it will not only lose China's huge market, but also Japan's own commercial reputation and the future of the semiconductor industry.

Wu Jianghao bluntly stated that the purpose of the United States is to re-establish semiconductor hegemony. If we follow the American designed routine, there will only be one outcome, which is a "double loss" between China and Japan, with the United States winning alone.

In fact, many analyses have pointed out that Japan's cooperation with the United States to restrict exports to China in the semiconductor supply chain will inevitably face backlash.

Japanese media pointed out that Japan's export of semiconductor manufacturing equipment to China is almost twice that of the United States.

In 2022, Japan will export more than 820 billion yen of semiconductor manufacturing equipment to Chinese Mainland. Chinese Mainland is the largest export destination for Japanese enterprises in this field, accounting for about 30% of total exports.

"This will disrupt the market expansion of Japanese companies, and from a regulatory perspective, it will definitely reduce their competitiveness." Suzuki Guiyuan, China Economic Research Director of Marubeni Corporation, a major Japanese company, said in an interview with BBC that Japan lacks a sufficiently large chip market domestically, and these export restrictions will be a blow to Japanese chip equipment manufacturers.

The Governor of Chang'an Street noticed that while Japan is gradually following the US government, American chip giants are collectively saying "no" to the White House.

On July 17th local time, executives from American chip companies including Intel, Qualcomm, and Nvidia met with senior government officials such as US Secretary of Commerce Raymond, Director of the National Economic Commission Brainard, and Assistant to the President for National Security Affairs Sullivan.

These executives of American chip companies expressed opposition to the US government's consideration of further restricting chip exports to China during the meeting, believing that chip export restrictions will harm the establishment of more effective bilateral relations between the US and China.

On the same day, the Semiconductor Industry Association of America also issued a statement opposing the US government's restrictions on American companies exporting chips to China.

The statement emphasizes that China is the "world's largest semiconductor commercial market" and is "crucial" for American companies. The statement points out that repeatedly adopting overly broad and ambiguous unilateral restrictive measures will seriously weaken the competitiveness of the US semiconductor industry, disrupt the supply chain, and trigger significant market uncertainty.

For a period of time, Japan has actively cooperated with the United States in various fields such as defense, economy and trade to contain China, leading to a complex and difficult situation in Sino Japanese relations.

In May of this year, the G7 summit was held in Hiroshima, and Japan, as the rotating G7 presidency, cooperated with the United States and others to smear and attack China, claiming to jointly respond to "economic coercion" from China. However, history clearly proves that Japan is precisely the victim of the United States' economic coercion.

In terms of defense, Japan is accelerating the evolution of its national military strategy towards proactive attack, attempting to follow the United States in building military hegemony in the Asia Pacific region. While significantly increasing defense costs, Japan actively links with NATO and plans to open NATO's first liaison office in Asia in Tokyo.

It is worth noting that on July 22, the day before Japan implemented export control measures for semiconductor manufacturing equipment, Japanese Prime Minister Fumio Kishida stated on China Japan relations, stating that "the relationship between China and Japan is inseparable.".

On the same day, Fumio Kishida stated in a public speech that although China Japan relations are "now stagnant", "China is Japan's neighboring country and largest trading partner, and the relationship between the two countries is inseparable. We hope to maintain a constructive and stable relationship while maintaining dialogue.".

The current situation of China Japan relations is severe and complex, especially the US factor has become the biggest external challenge affecting the stable development of China Japan relations. If Japan really wants to maintain a constructive and stable relationship with China, it should show sincerity and make rational and independent decisions, rather than going astray by acting as a scapegoat for the tiger and using its neighbors as a means to harm its neighbors.