The Netherlands sends signals to China

The Netherlands recently signaled that it will seek to meet with China to discuss resolving the current "stalemate" involving ASML. This event not only affects the economic and trade relations between China and the Netherlands but also creates uncertainty for the global automotive chip supply chain.

According to Reuters, Dutch Minister of Economic Affairs Vincent Karremans stated on a program on the 19th that China believes the Netherlands is collaborating with the United States to intervene in ASML's affairs. However, the Dutch government's intention with this action is to prevent the former Chinese CEO of ASML from transferring business and intellectual property out of Europe. Karremans noted that Chinese automotive manufacturers also need ASML's chips, and the Netherlands and China should work together to resolve this issue. He revealed that Dutch diplomats are actively mediating, and he himself will meet with Chinese officials in a few days, stating, "This matter has been elevated to the highest level of discussion."

The "stalemate" involving ASML stems from the so-called "penetration rules" issued by the United States on September 29. Subsequently, the Dutch government intervened directly in ASML's internal affairs through administrative means, triggering a chain reaction. ASML's global business and governance structure were impacted, and on the 17th of this month, reports emerged of Chinese employees being suspended without pay and system access being interrupted, affecting the company's operations.

On October 19, ASML's China branch issued an open letter titled "ASML China to All Employees" to "clarify the facts." The letter stated that at all times, ASML's domestic companies operate and make decisions independently as Chinese enterprises. It also emphasized that currently, the company's production and operations are proceeding normally, and all work is progressing in an orderly manner. The board of directors and management are fully committed to ensuring the company's normal operation and will not allow external forces to influence the company's operations or harm employee interests.

As the ASML incident continues to escalate, the global automotive supply chain is beginning to feel the pressure. Reuters reported that although ASML does not produce the most advanced chips, its products are diverse, produced in large quantities, and widely used, especially in the automotive electronics sector. ASML primarily produces chips in Germany, which are then packaged in China and sold to global automotive manufacturers. Industry insiders are concerned that if the "stalemate" continues and no alternative solutions can be found in the short term, global automakers may face supply shortages or even production halts.

The chairman and CEO of the American Automotive Innovation Alliance, John Bozzella, stated: "If the transportation of automotive chips cannot be quickly restored, automotive production in the United States and other countries will be impacted, potentially affecting other industries. We urge a swift resolution to the problem to ensure the normal operation of the automotive manufacturing industry in the United States and globally."

Chinese Ministry of Commerce spokesperson He Yongqian stated on the 16th that the U.S. "penetration rules" are the origin of harm to Chinese enterprises. He hopes that the Dutch side will adhere to independence and autonomy, and from the perspective of maintaining China-Netherlands economic and trade relations and stabilizing the global semiconductor supply chain, respect objective facts, uphold the spirit of contracts and market principles, correct erroneous practices, and effectively protect the legitimate rights and interests of Chinese investors, creating a fair, transparent, and predictable business environment.

Zhou Mi, a deputy researcher at the Ministry of Commerce Research Institute, told the Global Times on the 20th that if the Netherlands wants to resolve the issue, it must adhere to independence and autonomy, rather than generalizing the concept of "national security" under U.S. coercion and politicizing economic and trade issues. It must also comply with the contracts formed between both enterprises and general market principles, and properly resolve differences with China through consultation. Zhou Mi believes that this incident reminds us that against the backdrop of increasing global geopolitical uncertainty, it is even more important to adhere to the coordinated development of security and continuously break through key core technologies to build a more complete industrial chain Firmly grasp the autonomy and initiative of technological development to lay a more solid foundation for achieving high-quality development.

Author of this article: Ni Hao, Source: Global Times, Original title: "The Netherlands Sends Signals to China"

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