US to ensure S.Korean chipmakers' smooth operation regarding China curbs

Seoul, Sep 21 (IANS) The US will "do everything" to make sure that South Korean chipmakers are able to continue their business in China or elsewhere, a senior US official said on Thursday, one month to go before the expiry of its one-year waiver from equipment export restrictions on China.

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.

But Samsung and SK hynix received a one-year waiver amid concerns that the move would disrupt their businesses in China as the South Korean chip giants rely on US equipment for part of their production there.

"We understand the concerns that companies have and we'll do everything that we can to make sure that companies are able to continue to conduct their business," US Deputy Secretary of Commerce Don Graves told Yonhap News Agency in Seoul.

He was in South Korea for a two-day visit to discuss ways to boost bilateral cooperation on advanced industries and other pending issues of mutual concern.

Graves refused to comment on individual cases but stressed that Washington is giving them "the opportunity to explain to us why they should receive a waiver" as it wants "to make sure that what we're doing is allowing legitimate business to go on" and does not want to "constrain" them "unnecessarily."

"We want to have strong national security but also allow our businesses to be able to continue to do their work and to succeed, because ... if they're able to invest successfully, grow research and development, then they'll be able to have long term success and we'll be able to keep that technological advantage together as partners," Graves said.

Earlier, South Korea's industry ministry voiced expectations for the extension of the waiver as the two nations have been in talks regarding the issue.

Samsung runs a chip manufacturing plant in the Chinese city of Xian, which accounts for some 40 per cent of its global NAND flash production. In Suzhou, the chipmaker runs a semiconductor packaging factory.

SK hynix currently operates multiple plants in China, including one in the eastern city of Wuxi, where it manufactures about half of its global DRAM chips.