Report: Japan, Netherlands Joining US Chip Restrictions on China

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Facts

  • Japan and the Netherlands will join the US in restricting exports of semiconductor manufacturing equipment to China, according to sources familiar with the matter.
  • With talks between the three countries expected to end Friday, the Dutch company ASML Holding will reportedly be banned from selling machines that make advanced chips, and Japan will impose similar restrictions on Nikon.
  • Seiji Kihara, Japan's Deputy Chief Cabinet Secretary, said his country would take "appropriate steps" based on US and other nations' moves. In October, Pres. Joe Biden announced major restrictions on Chinese access to US chip technology.
  • In addition to the impact on Nikon, chip machinery manufacturer Tokyo Electron, which relies on China for about 25% of its sales, is predicted to be most affected. But the country reportedly expects affected companies to rebound because its manufacturing industry is expanding.
  • Some in the Netherlands also fear the move could hinder their companies' growing financial success. Meanwhile, Dutch PM Mark Rutte said any restrictions would be for national security reasons rather than to help protect US interests.
  • According to anonymous sources, a deal between the Netherlands and the US could be finalized by the end of the month.

Sources: Al Jazeera, EU Observer, Straits Times, and Reuters.

Narratives

  • Pro-establishment narrative, as provided by IB Times. As China's military and technological prowess grow exponentially, Western allies need agreements like this to protect against Chinese military-grade computer chip manufacturing. Though cutting companies off from China will take incredible domestic investment, it will be worth it when the US and its allies are safe from the prying eyes of the CCP.
  • Establishment-critical narrative, as provided by SCMP. Although Biden sees this as a victory, even ASML executives are warning this move could isolate western companies from the global market while China’s learning to manufacture semiconductors itself. This deal won’t do much to improve national security once the CCP figures out how to build military-grade computer chips on its own.