China's efforts to produce its own chips are getting more difficult after Japan and the Netherlands will follow the United States in stopping the sale of chip equipment to the country. According to a Bloomberg report, Japan and the Netherlands will no longer sell the chip printers needed to produce high-tech chips.
ASML from the Netherlands and Tokyo Electron and Nikon from Japan are the three main companies that manufacture these machines in the world. This Japanese approval will have a big impact on Tokyo Electron which generates 25% of its revenue through customers in China.
Over the past four years, various technological restrictions have been imposed by the U.S. and its allies on China to curb the country's ability to become a major power. Access to the production of 14nm chips and below is controlled to prevent them from being used by China to build military equipment.
Meanwhile AMD and NVIDIA are also barred from selling artificial intelligence chips for supercomputers to China for the same reason. China currently only has the technology to produce 24mm chips which is obsolete on a large scale. Efforts to develop a standalone chip industry are still immature with local 14nm technology not producing high results.