China will not let other countries’ scientific or technological obstacles stop its technological advance. That was Chinese President Xi Jinping’s message to prime minister Mark Rutte during his visit to Beijing on Wednesday. Xi was referring to the export restrictions imposed by the Netherlands on ASML under pressure from the United States.
Although the veiled threat was couched in terms of ‘cooperation in a multipolar world,’ Xi Jinping argued that creating scientific and technological barriers and severing industrial and supply chains will only lead to division and confrontation. Rutte responded that severing economic relations is not the Netherlands’ goal, nor is harming China’s technological development.
Xi’s comments followed the Netherlands’ decision to impose export restrictions on advanced chip machines. This includes ASML’s extreme ultraviolet lithography (EUV) scanners. However, China will not let its technological progress be hindered, Xi explained, stressing his country’s right to development. ‘Opening-up and cooperation are the only choice’ in a global market, he stated.
Tensions between the US and China
The export restrictions stem from tensions between the US and China over the latter’s access to Western technology, such as high-end processors for use in military applications. The US is pressuring allies like the Netherlands to join in.
As a result, Chinese semiconductor manufacturers are getting less access to essential equipment, such as lithography tools, which are necessary for chip manufacturing. Other restrictions include banning Chinese customers from receiving powerful AI hardware from Nvidia. Western countries also bar Huawei’s 5G equipment and other hardware for security reasons.
In response to Washington’s restrictions, China determined that its municipalities, ministries, and other government agencies would no longer be allowed to use Windows computers or chips from Intel and AMD. This decision was intended to strike a blow to the US chip market.
Keeping Chinese technology outdated
America’s goal is to keep China’s chip technology outdated. However, departing ASML CEO Peter Wennink, who saw trade with China drop significantly because of the restrictions, warned that such a strict approach could backfire. China’s pace of innovation would accelerate significantly as it would have to supply itself with advanced processors on its own. For example, the country is putting tens of billions of euros into Huawei to turn it into a chip powerhouse.
Although the Netherlands generally maintains friendly ties with China, with quite a few companies investing there, the Netherlands’ compliant attitude toward the US arouses resentment. China dresses up their rhetoric with a veil of diplomacy by emphasizing cooperation. Still, the country seems determined to develop itself as a technological superpower regardless of restrictions imposed by other countries at the direction of the US.
Also read: “ASML scrapped shipments to China under pressure from US”
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