A decision to bar Dutch lithography giant ASML from exporting some chipmaking tools to China was borne out of worry they would give an edge to the People's Liberation Army (PLA), the Netherlands' trade tsar has said.
"China focuses on foreign expertise, including Dutch expertise in the field of lithography, to promote self-sufficiency in its military-technical development," Dutch Trade Minister Geoffrey van Leeuwen said earlier this month during a parliamentary session, according to notes seen by Reuters.
ASML is at the center of the U.S.-China tech rivalry as the only firm currently capable of manufacturing the extreme ultraviolet (EUV) lithography machines that produce advanced microchips essential for a wide range of technologies, from electric cars to guided missiles.
Van Leeuwen said that when considering export licensing, the Dutch government takes into account "the risk of undesirable end use." He pointed out some of ASML's lithography tools produce chips capable of powering "high-value weapons systems and weapons of mass destruction."
Newsweek reached out to the Chinese embassy in the Netherlands with a written request for comment.
ASML announced last month it was canceling planned shipments of some of its proprietary machines in alignment with U.S. export controls. Washington is going on the offensive to limit Chinese advances in technologies it views as national security threats, such as supercomputing and artificial intelligence.
These efforts include leveraging Washington's partnerships with key partners with the chips supply chain, including the Netherlands and Taiwan.
The U.S. is also fine-tuning its efforts to limit China's military modernization, such as the new package of curbs on semiconductors and equipment that the Commerce Department's Bureau of Industry and Security introduced in October.
Beijing has accused its rival of bullying other countries into a "technological blockade."
China has also threatened to restrict U.S. access to rare earth elements and other critical minerals crucial to emerging technologies.
"The Dutch government has made the move obviously under intensifying pressure from the U.S.," Xiang Ligang, director-general of the Beijing-based Information Consumption Alliance, told Chinese state-backed outlet the Global Times.
Xiang said the restrictions on Chinese chip sector would "do great harm to the Netherlands" given the Chinese market accounts for a significant share of its exports.
China accounted for 29 percent of the Dutch company's total revenue last year, up from a 14 percent share in 2022.
"While the export controls impacted our business to China due to restrictions on advanced immersion systems and further restrictions on a handful of fans, demand for mature/mid-critical nodes in China is still quite strong," Karen Lo, AMSL's head of communications for Asia, told Newsweek.
Last summer, Chinese telecommunications giant Huawei bucked industry expectations when it announced its latest smartphone model, the Mate 60, was powered by an advanced and domestically produced 7-nanometer processor.
This achievement, reached despite strict U.S. export controls on Huawei and Chinese chipmaker SMIC, raised doubts about the effectiveness of the curbs. However, skeptics such as U.S. Commerce Secretary Gina Raimondo questioned whether China could produce the processor at scale.
Update 2/21/2024 9:40 a.m. EDT: This article was updated with a comment from Karen Lo.
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Micah McCartney is a reporter for Newsweek based in Taipei, Taiwan. He covers U.S.-China relations, East Asian and Southeast Asian ... Read more
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