Joining China Sanctions with ASML Equipment Export Controls
Emphasizing Cooperation Intent in Successive Meetings with US Delegation
Chinese President Xi Jinping said on the 27th that artificial supply chain disruptions cause division during a meeting with Dutch Prime Minister Mark Rutte. This is interpreted as a de facto 'warning' expressing concern over the economic repercussions amid the Netherlands, home to the global semiconductor equipment company ASML, joining the US in sanctions against China.
According to China's state-run CCTV, President Xi met with Prime Minister Rutte, who is visiting China, at the Great Hall of the People in Beijing on the same day and said, "Artificially creating technological barriers and blocking industries and supply chains only lead to division and confrontation," adding, "A truly safe world must be one of deep integration and mutual dependence." The two met for the first time in about 1 year and 4 months since their encounter in Bali during the G20 summit in November 2022.
Xi: "No force can stop China's technological development"
At this meeting, President Xi expressed willingness to cooperate with the Netherlands while directly voicing concerns about decoupling. He stated, "Decoupling has no way out, and open cooperation is the only choice," and added, "China has always regarded the black-and-white dualistic thinking of 'you lose, I win' as outdated." He further asserted, "The Chinese people have the legitimate right to development, and no force can stop China's scientific and technological progress."
President Xi also emphasized, "China will continue to expand a higher level of opening-up," and said, "China intends to maintain exchanges at all levels with the Netherlands, uphold communication and dialogue, and pursue mutual benefit and win-win outcomes." Regarding relations with the Netherlands, he evaluated that "the relationship is stable and rapidly developing, with cooperation in various fields continuously deepening."
These remarks by President Xi are interpreted as a critique and expression of willingness to resolve the US-led export controls and sanctions imposed on China's core sectors such as the semiconductor industry, in cooperation with some major countries. The Netherlands is home to ASML, the world's only producer of extreme ultraviolet (EUV) lithography equipment, which has joined US sanctions against China since 2022 by banning exports of related equipment to Huawei. Since early this year, the Dutch government has also restricted the sale of certain semiconductor components to China.
However, before the full-scale export sanctions, ASML's export share to China sharply increased last year. Looking at ASML's regional sales proportions last year, China accounted for only 8% in the first quarter but rose to 24% in the second quarter, 46% in the third quarter, and 39% in the fourth quarter. In contrast, exports to the US remained at 15%, 10%, 5%, and 11% respectively by quarter.
On the same day, meeting with US delegation: "Both countries must help each other"
On the same day, President Xi met with key figures from the US business and academic sectors and emphasized the importance of cooperation between the two countries. Meeting the US business and academic delegation at the Great Hall of the People, he said, "The Chinese economy is healthy and sustainable," and stressed, "China's economic growth rate last year was the highest among major countries and contributed over 30% to global growth."
He directly mentioned the 'China collapse theory' (the hypothesis that China will eventually collapse due to socialist contradictions) and 'peak China' (the view that China has reached its growth limit), stating, "China has neither collapsed nor reached its peak," and added, "The prospects for China's development are bright. We have resilience and confidence."
This was President Xi's first face-to-face meeting with US business figures since his visit to San Francisco last November to attend the US-China summit held during the Asia-Pacific Economic Cooperation (APEC) meeting. China's state-run Global Times (GT) evaluated, "This meeting not only reflects China's expectation that bilateral relations will continue to improve after last year's San Francisco meeting but also shows that China welcomes US investment and is focusing more on building relations."
It further cited major foreign media, stating, "More than 20 companies requested to attend the meeting, which lasted about 90 minutes." It also emphasized that over 80 global corporate executives attended the China Development Forum, which concluded on the 25th, with more than 30% being Americans, underscoring that "this is strong evidence that US companies' commitment to the Chinese market remains undiminished."
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