Semiconductor manufacturers in China could soon find it difficult to source the chemicals required for chip production to continue.
As Bloomberg reports, the German government is currently in talks to limit the export of chemicals to China that are vital to the production of semiconductors. This would not only impact China's ability to manufacture chips, but German companies such as BASF and Merck would see their orders from customers in China dry up due to the new sanctions.
A wide range of process chemicals and solutions are required for semiconductor production, including for cleaning, etching, photolithograpy, chemical mechanical planarization (CMP), and wet deposition.
For now, the German economy ministry isn't commenting, but the restriction of chemical exports is thought to be part of a wider clamp down on China's access to semiconductor goods and services by Germany.
China's ability to manufacture chips has already been greatly curtailed after the Dutch government stopped the most advanced semiconductor manufacturing machines making their way to the country A lack of access to key chemicals would mean even less advanced chip production could suffer in China.