China’s Had Its Chips

ASML produces Dutch microchips

ASML produces Dutch microchips Credit: ASML

EVERYONE loves Dutch chips and mayonnaise but the Chinese are not too happy wit a decision to make it more difficult to import chips of a different type into China.

On June 30, a new law was approved in the Netherlands ensuring that from September of this year Dutch companies making machines that produce advanced processor chips will need an export licence to sell their products overseas.

Supposedly, this new law is not aimed at any specific country, but the reality is that following a meeting between Dutch Prime Minister Mark Rutte and American President Joe Biden in January an agreement was reached to make life more difficult for China.

There is a combination of self-interest from the USA as well as an undisguised fear that the way Chinese politics and industry are moving that easy access to micro chips would allow that country to not only use them to commit human rights abuses but also develop even more weapons.

Over the past decades not only has China developed a huge and valuable production base, with low prices meaning that companies all over their world have turned to the East for mass production but this is turn hits the American economy and boosts that in China.

Realistically, the Chinese are known for their ability to copy and often expand existing technology but clearly, it’s easier to purchase the machinery rather than having to develop it.

At the moment, there is only one Dutch company, ASML which makes its chips using a technology known as extreme ultraviolet lithography and once the new law was approved, the billion euro company which employs 39,000 people worldwide saw an immediate drop in the value of its shares.

So as America and its partners in the European Union try to cut off access to much needed microchips, China is more than likely to find some way of hitting back at the Dutch Government over the long term.

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Written by

John Smith

Married to Ophelia in Gibraltar in 1978, John has spent much of his life travelling on security print and minting business and visited every continent except Antarctica. Having retired several years ago, the couple moved to their house in Estepona and John became a regular news writer for the EWN Media Group taking particular interest in Finance, Gibraltar and Costa del Sol Social Scene. Currently he is acting as Editorial Consultant for the paper helping to shape its future development. Share your story with us by emailing newsdesk@euroweeklynews.com, by calling +34 951 38 61 61 or by messaging our Facebook page www.facebook.com/EuroWeeklyNews

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