BNR – The Netherlands has issued new regulations banning the export of certain semiconductor production equipment. It comes as a result of US pressure to limit the selling of electronic chip technology to China.
The Dutch government, however, did not identify this as a justification, instead stating that the action took place for national security reasons.
According to the Chinese government, the decision did not lie in the best interests of either side. It further stated that it will have an impact on chip manufacturing and supply networks.
China’s foreign ministry spokesperson, Mao Ning, said the country opposes the US’s “abuse of export controls.” It also condemned the United States’s use of multiple pretexts to compel other nations into imposing an embargo on China.
The United States is competing with China for control of the semiconductor supply. This applies to certain computer processors used in supercomputers and AI.
Such chips have generated a $500 billion (£395 billion) business, which is predicted to double in size by 2030.
It is often assumed in the industry that whoever controls the supply chains has the pathway to becoming an unrivalled powerhouse. The supply chains are the interconnected networks of firms and nations that manufacture semiconductors.
The United States pushed broad export restrictions on exports of American chipmaking gear to China in October of last year. The action aims to prevent Chinese technology from being utilised to enhance the military of Beijing.
US and Netherlands Join Forces
However, for the US limitations to be successful, other significant providers, such as the Netherlands, have to step in.
The Dutch government said that beginning on 1 September, the export of some sophisticated semiconductor production equipment will require authorisation.
The action will have a particularly negative impact on ASML, the country’s largest firm and the world’s largest and most sophisticated chip equipment manufacturer.
ASML stated that it will continue to comply with relevant export restrictions, including those of the Netherlands, the European Union, and the United States.
Also, it stated that it isn’t anticipating the steps to have a significant impact on its financial standing.
According to Liesje Schreinemacher, Minister for Foreign Trade and Development Cooperation, some chips “can make a key contribution to certain advanced military applications” because of how they can be employed. “The uncontrolled export of goods and technologies therefore potentially poses national security risks,” she added.