A chip manufacture machine Photo: VCG

Despite US government restrictions on exports of advanced products, the country's chip equipment makers are still increasingly dependent on the Chinese market, with exports to China accounting for more than 40 percent of total sales. 

The dependence underscores the highly globalized semiconductor sector, which cannot be stopped by US technology restrictions, experts said.

According to a report by Nikkei Asia, China accounted for 43 percent of sales at Applied Materials in the February-April period, up 22 points on the year. China's share of sales at Lam Research rose 20 points to 42 percent for the January-March period.

This trend seems to run counter to Washington's plans under export curbs targeting China.

In 2022, the US government imposed restrictions on the export of advanced chips and chip manufacturing equipment used in the production of semiconductors, in an effort to contain China's semiconductor development.

Despite the technology blockade, American chip equipment manufacturers are finding it increasingly difficult to decouple from the Chinese market due to China's continued strong equipment spending and significant investments in the industry, Xiang Ligang, a telecom industry expert based in Beijing, told the Global Times on Sunday.

"China's rapid growth in chip manufacturing has created a huge demand for various equipment. While the US is also building factories, their efficiency is lower and they do not have as much growth space. From this perspective, demand in the Chinese market is high, and American manufacturers are certainly eager to sell to China," Xiang said.

A report from Semiconductor Equipment and Materials International released on July 9 showed that global wafer fab equipment sales are projected to increase by 3.4 percent year-on-year in 2024, reaching a new record of $109 billion. 

China is stepping up investment in the chip sector. 

The Shanghai Stock Exchange announced Sunday that it will officially launch a chip design themed index and a chip materials and equipment themed index on its Nasdaq-style sci-tech innovation board starting from July 26 to provide more investment options in the semiconductor industry for the market.

As of June, 102 semiconductor-related companies were listed on the sci-tech innovation board, with a total market value of 1.5 trillion yuan ($207 billion), accounting for 31.7 percent of the total market value of the board, according to the China Securities Journal.