Xi Jinping Discusses Technology Development with Dutch Prime Minister

A recent statement by Chinese leader Xi Jinping to Dutch Prime Minister Mark Rutte has underscored the tension and competition that define the current era: “No force can stop China’s scientific and technological development.”

by Faruk Imamovic
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Xi Jinping Discusses Technology Development with Dutch Prime Minister
© Getty Images/Kevin Frayer

A recent statement by Chinese leader Xi Jinping to Dutch Prime Minister Mark Rutte has underscored the tension and competition that define the current era: “No force can stop China’s scientific and technological development”.

This bold assertion comes amidst an intensifying "chip war" between China and Western countries, notably including the Netherlands, which is home to ASML, the sole manufacturer of extreme ultraviolet lithography machines essential for producing advanced semiconductors.

The Technology Tug-of-War

ASML stands at the heart of a brewing storm over technological supremacy. The Dutch company's unique position in the semiconductor manufacturing process makes it a key player in a global struggle over access to cutting-edge technology.

Xi's comments to Rutte, made during a meeting in Beijing, were a veiled reference to this ongoing battle. He remarked, “Artificially creating technological barriers and cutting off industrial and supply chains will only lead to division and confrontation,” a statement that reflects the broader concerns about the fragmentation of technological and economic alliances.

The backdrop to this discussion is the U.S.' s increased restrictions on semiconductor sales to China, with Washington pressing its allies, including the Netherlands, to follow suit. ASML finds itself in the crosshairs, having been prohibited by the Dutch government from shipping some of its most advanced lithography machines to China.

This move, viewed by many as a direct response to American pressure, highlights the delicate balance countries must strike between national security concerns and the imperatives of global commerce.

Seeking Common Ground

Despite these tensions, there is a shared interest in maintaining and enhancing bilateral trade relations.

On the same day Xi spoke with Rutte, Chinese Commerce Minister Wang Wentao met with Dutch Trade Minister Geoffrey van Leeuwen. Wang's call for “normal trade” of lithography machines, without directly mentioning ASML, underscores China's desire to keep channels of commerce open, even as it faces new restrictions.

The stakes are high, as demonstrated by a surge in sales of ASML’s advanced chipmaking tools to China ahead of the Dutch ban. In the fourth quarter of 2023, China accounted for 39% of ASML’s total revenue, signaling the country's aggressive strategy to secure as much high-end semiconductor manufacturing capability as possible.

Moreover, China's ability to access such technology is crucial for its ambitions to lead in the commercialization of 7-nanometer logic chips, a point driven home by the surprise launch of a Huawei phone powered by a 7-nanometer processor made by China's Semiconductor Manufacturing International Corporation (SMIC), despite U.S. export restrictions.

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