June 13, 2024

Xi Jinping’s Meeting with Dutch Prime Minister Mark Rutte: Highlighting China’s Dependence on European Technology Companies in the Global Semiconductor Industry

2 min read
The Dutch Company that Plays a Crucial Role in China’s Tech Industry

Beijing, China is the home of President Xi Jinping, a powerful figure who often delegates meetings with foreign leaders to his number two, Prime Minister Li Qiang. However, only particularly important guests are granted meetings with Xi Jinping, which makes visits like that of Dutch Prime Minister Mark Rutte significant in the eyes of the Chinese leadership.

The significance of Rutte’s visit stems from China’s reliance on a Dutch company, ASML, in the global semiconductor industry. ASML is the only company capable of producing lithography systems on a large scale, essential for semiconductor chip production. This makes ASML a valuable technology group in Europe and their technology crucial for China’s technological supremacy.

The global semiconductor industry is a battleground between the US and China, with Taiwan being a key player in chip production. In response to this competition, China has set out to become self-sufficient in semiconductor production and reduce its dependence on Taiwan. The US passed the Chips Act imposing an embargo on advanced semiconductor chips to China. The Netherlands, as a US ally, quickly joined the embargo impacting ASML’s business in China.

Xi Jinping criticized Rutte for joining this embargo stating that it only leads to division and confrontation. He emphasized China’s right to technological progress and development despite external restrictions. While China accepts the limitations of this embargo they seek to ensure that ASML can continue servicing machines in China.

Despite tensions over the semiconductor industry, China recognizes the importance of maintaining relationships with countries like the Netherlands and companies like ASML. Xi Jinping’s criticism of Rutte is a way to assert his country’s position but also acknowledges that strategic alliances and decisions have far-reaching implications for both parties involved.

In conclusion, Beijing views Rutte’s visit as significant because it highlights their reliance on European technology companies like ASML in their quest for technological supremacy. Despite tensions over trade and technology disputes between major powers like the US and China, both sides recognize that cooperation is necessary when it comes to global trade and technology development

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