China is developing alternatives to its reliance on Western chips and tools in packaging, manufacturing tools, subcomponents, and design; maintaining leadership in advanced packaging will be essential to maintaining overall semiconductor leadership as China designs around and designs out US technology.

A serious review of US export controls will become necessary at some point as China develops non-US semiconductor alternatives and the negative impact on the domestic industry grows.

After two years, the revenue impact of October 2022 export controls was small on chipmakers, larger on tool manufacturers, and will grow over time as more advanced chips fall within the scope of rules, while the controls did not change China's policy of developing its own technology but accelerated China's efforts.