Wang Yi visits the Netherlands and looks forward to the release of ASML EUV lithography machines

Bloomberg quoted people familiar with the matter as saying that the Dutch government is very likely not to grant ASML a license to ship EUV lithography machines to China. After the license expired a year ago, ASML did not obtain a renewal under pressure from the United States, so the EUV lithography machine that was supposed to be "delivered" in 2018 could not be delivered to SMIC.

Recently, Chinese Foreign Minister Wang Yi visited five European countries. After arriving at the second stop, the Netherlands, the question of whether ASML EUV lithography machines can be exported to the United States has attracted much attention. Bloomberg said that Sino-US relations are becoming increasingly tense, and the United States has begun to suppress China's semiconductor industry by blocking Huawei. The Netherlands has been involved in this technological cold war because it owns the lithography machine giant ASML. Since last year, the United States has been lobbying the Dutch government not to export this key semiconductor equipment to China. This time, Wang Yi also discussed the issue of lithography machine exports with the Netherlands, but another person familiar with the matter believes that even if Wang Yi visits, the Netherlands is still unlikely to give in.

The Netherlands is one of the few countries in the world with a complete semiconductor industry chain. Its semiconductor industry has an annual revenue of more than 10 billion euros, and more than a quarter of the world's semiconductor equipment comes from the Netherlands. As the world's leader in lithography, ASML has built the world's most comprehensive and powerful lithography supply chain system, almost monopolizing the entire lithography market, especially the high-end lithography market, where ASML is the only one.

Among sub-sectors, European semiconductor companies such as ASML are the most global, with the semiconductor industry generating just 14% of its sales in Europe, data compiled by Bloomberg show.

Whether or not China can purchase ASMLEUV lithography machines is an important piece of the puzzle for the smooth development of China's semiconductor industry. It not only affects chip production, but more seriously, it may even lead to the situation where products cannot be launched. No matter how strong the upstream IC design and research and development capabilities are, they will be useless.

In addition, Bloomberg believes that the lawsuit between ASML and XTAL may also be a reason why the Netherlands no longer issues licenses. In order to curb ASML's dominance, some semiconductor companies, including Intel, IBM, and Samsung, are interested in supporting XTAL, a lithography machine manufacturer founded in Silicon Valley in 2014. In 2018, ASML sued XTAL for infringement of intellectual property rights, and eventually won the case and received US$845 million in compensation in May 2019. Dutch media claimed that senior Chinese employees in XTAL's R&D department stole official secrets from ASML and leaked them to the Chinese government.

Although ASML denied China's "espionage" activities, the case still caused a stir in the Dutch parliament.