Final blow for China: the Netherlands follow the US in crippling its chip industry

The world of high-tech chips might seem distant—somewhere between science fiction and circuit boards—but the battle over who controls the tools to build them is very real. And China, once a rising force in this domain, is now facing a serious setback. With the Netherlands siding with the US in a quiet yet powerful alliance, the future of Chinese tech ambitions is under threat. Here’s why this matters, and what it could mean for the next generation of global technology.

The Dutch gatekeepers of high-tech power

In the rarefied world of semiconductor manufacturing, one company sits at the pinnacle—and it’s not American, Chinese or even South Korean. It’s a firm tucked away in the Netherlands: ASML. You might not have heard of it unless you spend your days tinkering with microchips, but within the tech industry, ASML is a household name. Why? Because it produces the only machines in the world capable of manufacturing the most advanced computer chips using a technique called extreme ultraviolet lithography.

These aren’t your average printers. We’re talking about machines the size of a bus, costing more than £100 million apiece, capable of etching impossibly fine patterns onto silicon wafers—the building blocks of everything from smartphones to missiles. And here’s the catch: ASML has a monopoly. If you want to produce cutting-edge chips, you need their kit. Full stop.

The silent war behind the silicon

So what happens when one country controls access to such critical technology? Well, a geopolitical drama unfolds—and it’s not exactly subtle. The US, keen to keep China from catching up in the race for technological supremacy, has persuaded (some would say pressured) the Dutch government into tightening export restrictions on ASML’s equipment.

ASML had already refrained from selling its most sophisticated machines to China. But now, even slightly older versions are being pulled from the table. The official line? National security. The real aim? To slow down China’s technological progress—particularly in sectors like defence and artificial intelligence, where ultra-thin chips play a vital role.

Can China work around the wall?

You’d think that a country with China’s resources could simply build its own machines. It’s trying. But replicating what ASML has achieved is like trying to recreate a Stradivarius with a hacksaw and some IKEA instructions. Chinese firms like Moore Threads are developing their own graphics processing units, and their MTT S80 GPU even boasts a computing power of 128 teraflops. But when tech reviewers got their hands on it, let’s just say the performance was… inconsistent.

China is investing heavily in becoming self-sufficient, pouring billions into domestic chip production and emerging technologies. Its new 3D5000 processor with up to 32 cores is proof that they’re serious. But for now, they’re a few laps behind in a race where even a millisecond counts.

US influence, Dutch compliance

The role of the US in all this is hardly background noise. It’s leading the charge, tightening controls and bringing allies like the Netherlands along for the ride. While the machines come from Eindhoven, the political engine room is in Washington.

And not everyone’s thrilled. Chinese officials have called for the Netherlands to adopt a more “objective and fair” stance. Translation? Please stop letting the US dictate your export policy. The frustration is understandable—it’s like being locked out of a party you helped pay for.

Yet, for all the political wrangling, the practical effect is clear: China’s chipmakers are being boxed in, struggling to innovate without access to the tools they need most.

A long game with high stakes

Here’s the twist: while ASML isn’t selling these machines to Chinese companies, it still does business with Samsung and SK Hynix—South Korean giants who, incidentally, make chips in Chinese factories. So, yes, the machinery is still making its way onto Chinese soil, albeit under a different flag.

It’s a loophole, sure, but not a long-term solution. As restrictions tighten and oversight grows, China knows it needs to build its own road—or risk being left permanently in the slow lane.

And that’s the story unfolding now. The West is banking on cutting China off at the source. China, in turn, is betting it can go it alone. Which side wins won’t just determine who dominates the tech world—it could shape the balance of global power for decades to come.

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Brandon Lee

Hi, I’m Brandon from the Decatur Metro team. I guide you through the trends and events reshaping our region.