In the Netherlands is the largest technology company in Europe by market capitalization. It is ASML, valued on the stock market at more than 235,000 million euros. It is dedicated to manufacturing advanced technology for chip production.
Specifically, it produces machines that are like state-of-the-art semiconductor printers. In practice, ASML is the only company that has this technology, protected by patents.
Well, the Minister of Foreign Affairs of the Netherlands, Liesje Schreinemacher, stated yesterday that "the Government has reached the conclusion that it is necessary for international and national security to extend the current controls on the export of materials for the production of semiconductors specific”.
Neither ASML nor China is mentioned, but it is clear that the measure will have consequences in this commercial relationship. The restrictions affect ASML's Deep Ultraviolet Lithography (DUV), which is used for advanced semiconductors, needed not only for consumer goods (mobile phones, computing, or artificial intelligence) but also in the military industry.
The company does business in China (18% of its sales) but assured that the ban on the export of these highly advanced machinery will not affect its income statement. Its main markets are Taiwan and South Korea, where ASML sells its equipment to Intel and TSM (Taiwan), which in turn supply companies such as Apple and Nvidia.
Its CEO, Peter Wnnick, recently complained that trade secrets have been stolen and revealed that a Chinese employee allegedly kept confidential information.
According to experts, China is still lagging behind in semiconductor technology compared to the West. Beijing has long wanted to make more advanced computer chips, for which it needs ASML machines. Without these teams it will be difficult for you to make up ground. This is, basically, the idea.
Indeed, the gesture of the Netherlands is a nod to the US, which since last October launched its own crusade against Beijing, to isolate it from a technological point of view (the first victim was Huawei's 5G network years ago). ). Apart from favoring the relocation of semiconductor production in the country, the Americans vetoed chip deliveries to China.
But for the measure to be effective, Washington needed the help of the Europeans. The Americans have already interceded to block the delivery of an ASML device to China in 2019. Now the explicit support of the Dutch has just arrived.
And, after the Netherlands, another country that could join this trade blockade against China is Japan, which has repeatedly debated the importance of defending its strategic and economic interests in chips, bringing the West's grip on Beijing could end up squeezing from several sides.
China was quick to express its disapproval. “A country has surpassed the concept of national security, politicizing and instrumentalizing and depriving China of its right to develop and maintain its hegemony. These acts weaken the international trade order and market rules," a Chinese foreign ministry spokesperson said.
In the background of these commercial skirmishes is the struggle for technological leadership, but also the new meaning that the expression “national security” is assuming. According to the rules of the WTO (World Trade Organization), a country can impose trade restrictions if its interests in the field of security are threatened. For years, no country claimed this reason, considering it a diffuse concept and under the risk that if this exception began to be abused, the entire trading system would collapse.
But this consensus was broken with the Trump Administration, which pulled this exception out of the hat to justify its tariffs on steel. Since then, Pandora's box has been opened. And today, commercial sources admit, "national security" is used to refer to "the economic security of a sector with the aim of not giving advantages to your adversary."
A drift that is affecting the foundations of international trade. There are four complaints against the US from different countries alleging the arbitrariness of the restrictions under this concept and, for now, in the first instance in the WTO courts the Americans have already lost in two cases.
