Although such an embargo would not cause the immediate closure of SMIC, a lack of on-going support and spares for equipment would have an impact on productivity. In the medium to longer term it could cause SMIC to change its methods of manufacturing and what it is able to make.
The news caused SMIC's share price to fall by 20 percent when it opened Monday September 7. However, due to the strong run on the shares after they opened on the Shanghai stock market the price has only fallen back to where it was on June 1.]
In a statement SMIC said: "Any assumptions of the company’s ties with the Chinese military are untrue statements and false accusations. The company is in complete shock and perplexity to the news. Nevertheless, SMIC is open to sincere and transparent communication with the U.S. Government agencies in hope of resolving potential misunderstandings."
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