The US government tries to prevent Chinese enterprises from obtaining advanced processor designs and chips to restrict China. Global semiconductor industry enterprises lost huge market value. As the chip industry is global, the decision of the United States will affect the entire semiconductor supply chain. For some time, the market value of large chip companies has been decreasing. As the United States takes more restrictive measures, more semiconductor companies will suffer losses. The Philadelphia Stock Exchange semiconductor index hit a new low this week.

Chaowei Semiconductor, Nvidia, Intel and other enterprises sell a large number of advanced chips to China, and the US crackdown will inevitably hurt these American companies. If the US government does not allow them to fulfill their existing orders and continue to cooperate with Chinese partners for a period of time, Nvidia’s quarterly revenue may decrease by 400 million US dollars. At the same time, the decision of the US government will accelerate the development of high-performance GPU computing by Chinese companies such as Piron Technology.

For China, the good news is that Japanese chip equipment companies, such as Nikon, Canon and Tokyo Electronics, will be affected by the pressure from the United States, so they may consider developing equipment that does not use American technology.

Investors’ concerns about the sharp decline in chip demand and the impact on the future of the global semiconductor industry if the United States decides to impose stricter sanctions on China’s chip industry are leading to more market value evaporation.

The United States announced its restrictions on China’s access to American semiconductor technology, which greatly increased the risk of the US China science and technology war. However, Washington’s attempt to regain the primacy of chip manufacturing and slow down the rise of China is facing huge challenges. Although the United States is leading in chip manufacturing tools and software, it is increasingly being replaced by Asian competitors in the manufacture of advanced chips that are critical to fighter aircraft, unmanned aerial vehicles and sophisticated military hardware. As the United States tightens its control of advanced technology, Beijing is likely to strengthen its scientific and technological autonomy.

More and more export restrictions in the United States will also hurt American companies that export billions of dollars of technology and hardware to China, weakening their R&D investment. The sanctions will also hurt major chip manufacturers in Taiwan, South Korea, Japan and Europe.

The West tried to prevent China from acquiring the latest technology, in order to weaken China’s power, and at the same time, to ensure its economic dominance over countries whose ideology is contrary by maintaining technological advantages. China must find a way to cope and consider a future independent of Western supply. Sanctions will undoubtedly harm China’s economy, military and ability to develop new technologies. Those desperate enterprises will struggle for survival. Therefore, all these restrictions are likely to promote China’s more independent semiconductor industry and create an industry free from external interference.

One of the problems facing China is that creativity and individuality are rarely encouraged. But if China decides to change its attitude, it may soon achieve many technological breakthroughs. As these breakthroughs are generated within China, they will invalidate the Western technical sanctions against China.

It is clear that China is seeking future technological solutions, and the huge pressure from the West has played a role in boosting it. If the west forces too hard, it may stimulate China’s creativity more, and find ways to avoid the influence of the west.