US chip ban on China frustrated: Netherlands refuses to copy EU and says it won’t follow US disengagement from China | blog post

The Netherlands dared to resist the US ban on China because the lithography machine manufacturer ASML had full confidence.

Affected by the restrictions, China imported a total of 4,226 semiconductor manufacturing equipment in October, with an import value of about US $ 2.037 billion, a decrease of 39.8% and 23.1% respectively compared to the same period last year. According to a Bloomberg analysis, it is not clear how many imports have been affected by the US restrictions, but purchases from major equipment exporters such as Japan and the US have all declined.

At the same time, China’s purchases from the Netherlands have roughly doubled.

ASML, headquartered in the Netherlands, accounts for more than 60% of the global lithography machinery market share. Since the Trump administration, the US has been lobbying the Netherlands to ban the company from selling high-end lithography machines to China. Under the US coercion, ASML is currently unable to export the most advanced extreme ultraviolet (EUV) lithography machine to China, but can continue to sell the previous generation of deep ultraviolet (DUV) lithography machine. The difference between an EUV lithography machine and a DUV lithography machine is that the latter cannot produce chips with a process of 7 nanometers and below, but it is enough to produce chips for cars, mobile phones, computers and robots that are more in demand. According to the ASML 2021 financial report, mainland China is ASML’s third largest market, with an operating income of 2.7 billion euros, accounting for approximately 14.7% of its global turnover in 2021.

ASML in the Netherlands is the world’s largest supplier of lithography machines.

However, since July this year, the United States has sent officials to the Netherlands in succession to put pressure on it, asking to expand the scope of the current export restrictions to China and ban ASML from exporting some DUV lithography machines to China. According to people familiar with the matter, the Dutch government did not agree at the time, believing that if the measures requested by the United States were implemented, the Dutch trade relationship with China could be harmed.

Not only that, ASML Chief Financial Officer Dasen said that the new US regulations have a limited impact on the company’s lithography machine exports, because it is a European company and “uses very few American parts.” Wen Nink, CEO of ASML, believes that the US restrictions indirectly affect 5% of undelivered orders, but the company’s export rules will not change, which will have a limited impact on the plan general shipping for next year. Singapore’s “Lianhe Zaobao” mentioned in the report that ASML is increasing its staff recruitment in China. As of the end of August 2022, ASML has more than 1,500 Chinese employees, an increase of about 200 from the end of last year. Currently, ASML China accounts for 14% of its global employees.

According to US media reports, Schreinermacher’s latest statement highlights that the Netherlands is increasingly angry at the US request for “consistency in export control measures”. The European country wants to keep access to China, a major global market.

Xiang Ligang, a senior expert in China’s telecommunications industry, said that the Dutch side’s statement actually represents the common voice of many European companies, and there may be more similar statements in the future. Xiang Ligang believes that China is the most important semiconductor consumer market in the world, and is also an important part of the semiconductor industry chain, not only contributing an important source of revenue to global semiconductor companies- wide, but also provides these companies with a large number of upstream and downstream industrial support. . From these two points of view, European companies, including ASML, are unwilling or unable to give up on China, especially when their own interests are damaged, blindly following the United States will be do much harm but no benefit.

Some media have noticed that although the US government is still increasing pressure on its allies recently, many European countries and European leaders are calling for a connection with Beijing and refuse to join the camp of stopping Chinese semiconductors . French President Emmanuel Macron recently said that he must resist the practice of dividing the world into rival groups. German Chancellor Scholz recently expressed a similar view.

According to foreign media reports, on the same day that the Minister of Foreign Trade and Development Cooperation of the Netherlands said that he was “reluctant to participate in the US encirclement of China’s semiconductor technology”, the EU High Representative for Foreign Affairs and Security Policy Borelli insisted in a debate in the European Parliament on the 22nd that the EU will not follow the example of the United States in adopting strict sanctions against China. Borelli pointed out that Europe and China have different political systems and have different views on certain issues, but these differences should not and will not prevent Europe from engaging with China. He added: “Of course, the United States is our most important ally. But in some cases, our position or our approach to China will not be the same (with the United States). ” In terms of thinking, he should “take into consideration the reality of life and the complexity of this reality, and that the European Parliament needs to contribute to this too”. He emphasized that China should play its due role on the world stage due to its size and economic strength, “We cannot think that we can create the future while leaving this country behind.”

EU High Representative for Foreign Affairs and Security Policy Borrell.

Bloomberg said Borelli’s speech showed the EU was keeping its distance from the US “chip ban”. The ban has sparked panic among semiconductor manufacturers in European countries. His comments echo those of Schreinermacher.

The French newspaper Les Echos recently published an article by Allianz Group’s chief economist, Sublan, saying that Europe cannot “disengage” from China. China is driving the world’s economic development. Currently, European machine tool, construction, food and electrical industries are highly dependent on imports from China, and the import volume has continued to grow in the last 20 years. Sublan believes that despite the intense competition in the fields of global economy, trade and finance, Europe and China need closer cooperation in new technologies and environmental protection.

Ruduo, CEO of CMA CGM China, recently pointed out that since the onset of the new crown pneumonia, China has shown strong resilience in the global supply chain. Now China has become CMA CGM’s biggest market in the world. The group is the third largest container shipping company in the world.

In the context of globalization, the United States has repeatedly politicized, instrumentalized and ideologically and economic and trade issues, and its practices of “blocking” and “technological decoupling” against other countries attract the surveillance of other countries, including her allies. .

Dong Yifan, a scholar at the European Institute of China Institutes of Contemporary International Relations, pointed out that the US practice of “enclosing” China in the field of science and technology has artificially disrupted the trend of globalization of economy and technology, which was brought about. destroy and fragment industries, and hijack other countries Make the market and innovation more fragmented. In this case, the United States and its allies will suffer losses, which is not conducive to economic recovery. Dong Yifan also pointed out that the European economy is currently trapped in the fog of high inflation and energy crisis. China’s huge market and complete industrial supporting capabilities are important external forces for Europe to get out of the risk of recession economic. From this point of view, there is a conflict of interest between Europe and the United States, and a game has emerged on the issue of whether to jointly restrain China.

Recently, the most significant economic disagreement between the United States and the European Union stems from the “Inflation Reduction Act” signed by US President Biden. On the 22nd local time, French Finance Minister Le Maire said in Paris that France and Germany agree that Europe needs to respond strongly to the US government’s plan to support some US industries. On the 21st, Macron had lunch with more than 40 executives of European companies, calling on them to stay and invest in Europe.

On the 22nd, while attending the economic forum hosted by the “Süddeutsche Zeitung”, Scholz emphasized that “deglobalization is a dangerous wrong path.” He encouraged German companies to cooperate with promising regions in the world “under fair rules” Do more trade .

Chinese Foreign Ministry spokesman Zhao Lijian said on the 23rd that the formation and development of the global industrial chain and supply chain is the result of the combined effect of market laws and corporate choices. Introducing ideology and value lines in the field of economic and trade cooperation is not only conducive to the common interests of the international community, but will also shoot itself in the foot.