China’s chip imports drop 15% as US tightens tech export controls

China’s semiconductor imports dropped 14.6 per cent (year-on-year) in the first nine months this year amid tightened US export controls, the media reported on Saturday.

China imported 355.9 billion units of integrated circuits (ICs) from January to September, down from 416.7 billion in the same period last year, according to data published by the General Administration of Customs, reports South China Morning Post. The total value of IC imports fell 19.8 per cent to $252.9 billion.

However, “the year’s IC import trend for China shows a modest improvement over the past several months,” the report noted.

China’s huge demand for advanced semiconductors to power new artificial intelligence (AI) development projects has created a fast-growing market for graphics processing units (GPUs).

The drop in chip imports came amid increased export controls by the Joe Biden administration. In October last year, the US announced a set of rules that restrict exports of certain advanced semiconductor manufacturing equipment and items to companies in China in an apparent bid to slow Beijing’s technological advances.

According to reports, US rules restricting shipments of AI chips and chipmaking tools to China are set to be tightened in the coming days. The US has been seeking to halt the rise of China’s artificial intelligence capability as China’s AI capability depends on its access to US chips, the reports mentioned.