The chief executive of JSR, one of the world’s largest suppliers of a material critical for semiconductor production, has said lack of industry infrastructure will make it “very difficult” for China to develop leading-edge chipmaking technology despite a push for self-sufficiency.
Eric Johnson, a rare American leader at a Japanese semiconductor company, also said in an interview that he expected chip sector supply bottlenecks to continue into 2023.
US export curbs on technologies required to make the most advanced chips have prompted China to invest heavily to develop its own semiconductor supply chain.
But Johnson said China would struggle to master the sophisticated chipmaking technology based on a technique known as extreme ultraviolet or EUV lithography.
“I think China also would love to develop their own EUV competency, their ecosystem for these things. I think it’s going to be very difficult for them to do that, frankly,” Johnson said.
Semiconductors, essential to products from smartphones to washing machines, have become a focus of competition between Washington and Beijing. Joe Biden on Friday began his first trip to Asia as US president by visiting a Samsung chip plant in South Korea and stressing his desire to secure semiconductor supply chains.
EUV lithography is a highly demanding process using light to etch minuscule integrated circuits on to silicon wafers.
Even if China “got a paper on exactly what the chemistries were . . . to manufacture that at the purities, and the precision, and reproducibility is really tough”, Johnson said. “It’s not that simple and they don’t have the supply chain to support that either.”
Tokyo-based JSR is a leading supplier of photoresists, thin layers of material used to transfer circuit patterns on to semiconductor wafers. Analysts say it has around 30-40 per cent of the global market for photoresists used to make advanced chips and counts Samsung, Taiwan’s TSMC and Intel of the US among its customers.
China is the world’s biggest importer of chips and has been investing heavily in semiconductor initiatives as part of its “Made in China 2025” push, which calls for 70 per cent self-sufficiency in the most important components for critical technologies by 2025.
But Johnson said “leading-edge capability takes decades and a lot of money to develop . . . you really need applications like the iPhone to pay for the stuff”.
Still, Johnson stressed that Beijing was aggressively investing in less advanced chipmaking technologies that were also important, and that China was a big part of JSR’s growth strategy.
He said he wanted to balance being able to “respectfully” and “responsibly” service customers in China with “sensitivity to the concerns that the US government has and concerns with protecting interests in Japan”.
“It is under-appreciated how much opportunity there is in China that’s not dependent on those very leading-edge capabilities,” he said.
Johnson said global chip supply bottlenecks that have undermined the global economy would take until next year to resolve.
“It just takes time to bring new capacity online and that new capacity won’t really start to make an impact probably until the end of this year or next year,” Johnson said.
He said he expected it to be particularly “problematic” for the sector to meet demand for semiconductors used in vehicles, as they used less advanced chips which were less profitable and so attracted less investment.
