(JW Insights) Mar 27 -- China is forecast to place third in equipment spending worldwide in 2024. U.S. export controls are expected to limit China’s spending, said SEMI, a global semiconductor association based in the US.

South Korea will likely increase its investment in fab equipment by 41.5% to $21 billion in 2024, while China logs only a 2% increase to $16.6 billion, said SEMI.

The shift underscores China’s struggle to secure crucial machines to improve its chips as US curbs make it harder to access equipment purchased from a handful of makers like ASML Holding NV of the Netherlands. As the Dutch and Japanese governments join restrictions imposed by the US on exports to China, the most advanced chips and equipment from the likes of Nvidia and Tokyo Electron are being kept out of Chinese hands, said a Bloomberg report.

US chipmaking equipment suppliers including Applied Materials, Lam Research and KLA are expected to lose billions in sales this year due to the US restrictions on China.

The Taiwan region is expected to retain its global lead in fab equipment spending with $24.9 billion in 2024, a 4.2% increase this year, SEMI said separately in its quarterly global forecast.

Overall, global fab equipment spending is expected to increase 21% to $92 billion in 2024 after it decreases 22% this year on weaker chip demand and higher inventories, SEMI said.

(Li PP)