The Double-Edged Sword of Semiconductor Export Controls: Electronic Design Automation

Photo: Ryan Anson/Bloomberg/Getty Images

Photo: Ryan Anson/Bloomberg/Getty Images

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This paper, the third in the four-part design-out series, focuses on China’s design-out and design-around strategies related to design services, electronic design automation (EDA), and core design intellectual property (IP)—critical tools for developing semiconductors. As expanding U.S. and allied export controls limit Chinese access to advanced semiconductor technologies, these design tools have become increasingly important to China’s national semiconductor strategy. While the United States remains the dominant player in semiconductor design and EDA tools, recent trends indicate a slow decline in market share. With China—in addition to traditional U.S. partners such as South Korea—strengthening their domestic design capabilities, U.S. companies risk losing a critical revenue stream, particularly as China accounts for a significant portion of their sales. When it comes to the design portion of the semiconductor supply chain, workforce challenges and export control enforcement issues are more prevalent threats to U.S. economic security than design-out considerations.

This report is made possible through generous support from Applied Materials, ONTO Innovation, and SEMI ESDA.

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China, Trade and International Business, Economic Security, Technology and Innovation, and Defense and Security
William Alan Reinsch

William Alan Reinsch

Senior Adviser and Scholl Chair Emeritus, Economics Program and Scholl Chair in International Business

Altynay Junusova

Former Intern, Economics Program and Scholl Chair in International Business

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