U.S. Considers Halting Global Chipmakers’ Access to American Tech in China: A Bold Move to Safeguard National Security

A motorcycle was spotted outside the Taiwan Semiconductor Manufacturing Company (TSMC) in Hsinchu, Taiwan, on April 16, 2025, amid growing tensions in the semiconductor sector. Semiconductor stocks took a hit on Friday following reports that the U.S. government is contemplating the termination of waivers that permit certain chipmakers to transfer American technology to their facilities in China.

According to a report from the Wall Street Journal, Commerce Department official Jeffrey Kessler recently approached major firms, including Samsung Electronics, SK Hynix, and TSMC, to discuss revoking their waivers. These waivers currently allow these companies to utilize U.S. chipmaking technologies in their Chinese operations. This development has added to the uncertainty plaguing U.S.-China relations as both nations navigate a fragile truce over tariffs and trade, with semiconductor regulations at the forefront of the discussions.

In the wake of the announcements, the VanEck Semiconductor ETF dipped approximately 1%. Notable declines were also seen in key industry players: Nvidia, Qualcomm, and Marvell Technology all fell by around 1%, while TSMC experienced a sharper decline of nearly 2%.

These moves come shortly after the U.S. and China established the framework for a second trade agreement in London just days prior, following a period of heightened tensions post the initial tariff freeze earlier in May. Since then, the U.S. has implemented several changes to chip export regulations that have strained relations further, with China describing the restrictions as “discriminatory.”

American chipmakers have faced a growing array of curbs in recent years, largely aimed at restricting sales of advanced artificial intelligence chips to China due to national security concerns. In its latest earnings report, Nvidia disclosed that the recent sanctions on its H20 chips bound for China adversely affected sales by approximately $8 billion. Nvidia CEO Jensen Huang elaborated on the situation during a recent earnings call, underscoring that the $50 billion market for AI chips in China is “effectively closed to U.S. industry.”

In a May interview with CNBC, Huang lamented the significant losses U.S. companies face due to being denied access to the lucrative Chinese AI market.

As the landscape continues to shift, the semiconductor industry is bracing for further developments, particularly as the U.S. prepares to take action concerning the ability of its allies to ship American chip-making equipment to China. With significant implications for global supply chains and economic stability, this landscape will be closely monitored by investors and analysts alike.

For further insights, you can refer to the full report by the Wall Street Journal.

Original Source: https://www.cnbc.com/2025/06/20/chip-stocks-china.html
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Publish Date: 2025-06-20 22:56:00