From a position of strength: China allowed to supply chips to the EU
China has resumed exporting some Nexperia chips, which could alleviate supply shortages in the automotive industry and be a step towards resolving the conflict with the Netherlands. In turn, the Dutch will abandon attempts to bring the corporation controlled by the Chinese business under their control. Thus, another crisis in economic relations between Beijing and Brussels must be resolved. Why the scandal surrounding a multinational semiconductor manufacturer turned out to be so important, who can be considered the winner in this dispute in the end, and how another strategic vulnerability of the EU manifested itself — in the Izvestia article.
Why Nexperia is important
The main problem in the conflict with Nexperia is that it is not an ordinary chip manufacturer. The Netherlands is a country that is a European leader in the semiconductor industry, although in general this sector is less developed in the EU than in East Asia or North America. It is enough to recall ASML, the only supplier of devices with EUV photolithography in the world, allowing the production of the most modern chips (5 nm and below).
Unsurprisingly, Nexperia, one of the largest chip manufacturers on the continent, is located there, even though its factories are located in different countries. Nexperia has been a division of Philips for a long time. In 2006, it (under the name NXP Technologies) was released into "free floating", and was later acquired by a consortium of investors led by a Chinese investment fund. Eventually, the rebranded company was bought by Chinese Wingtech.
Nexperia Company Employee
Nexperia produces relatively simple chips based on technological processes that are far from the latest technology. However, these are the most important things: diodes, transistors and other components, without which it is difficult to imagine the existence of many complex products of the modern civil sector. The total annual output is estimated at 100 billion parts.
The automotive industry is a key area, with European automakers, including Volkswagen and Mercedes, being the main consumers of Nexperia products. They were the ones who came under attack in the first place as a result of the conflict. When the Nexperia scandal first broke out, Mercedes CEO Ola Kallenius admitted that the company had to "look for alternatives in a hurry" to avoid a supply crisis. The situation in many ways resembled the collapse of supply chains during a pandemic.
"Relatively honest" nationalization
In October 2025, the Dutch government applied a rare legal instrument, the Accessibility of Goods Act, to take temporary control of Nexperia's management. In support of its intervention, the Dutch state pointed to the actions of Wingtech founder Zhang Xuezheng, which, according to the wording, represent "the misuse of financial resources for the personal enrichment of the CEO, as well as his other companies in China." Wingtech rejected these allegations and demanded that he be reinstated as CEO of Nexperia after being ousted by an Amsterdam court.
The real causes of the conflict were deeper. Firstly, in a situation of political escalation, the European Union and specifically the Dutch government have taken care of European technological sovereignty. There were concerns that Wingtech could move key technologies and know-how to China, depriving Europe of critical competencies. This could have been an overly harsh reaction to the situation, since most of the technologies used by Nexperia are already well-known in China.
But even more important was the pressure from Washington. The United States has been trying for years to force the Netherlands to minimize cooperation with China in the field of semiconductors. The supply of new photolithographic machines to China has been prohibited for a long time, and new export control items are constantly being introduced. Although this threatens serious losses for the Dutch, it is unlikely that they will be able to ignore American demands in Amsterdam. The vice president of the Chinese company even called the Dutch Ministry of Economy an "obedient sheep" following Washington.
However, the escalation of the conflict did not last long and showed where the leverage really is. China responded symmetrically by imposing restrictions on the export of chips manufactured at Nexperia factories in China. Since these enterprises accounted for about half of the company's total capacity, the decision posed an immediate and real threat to the European automotive industry. Subsequent events have shown that the EU was not ready for such a price war.
Already in early November, the Dutch authorities, according to Bloomberg, were ready to suspend their powers over Nexperia in the event of a resumption of shipments from China. China, in turn, "has taken measures to allow the export of some chips." The result did not look like an unconditional surrender, but rather like a tactical exchange that allowed the parties to save face.
Strategic dependence
Nevertheless, the episode illustrated an increasingly noticeable trend in the EU: Europe's dependence on China is of a strategic nature. As the head of the European Commission, Ursula von der Leyen, noted, the EU imports more than 90% of the rare earth magnets needed for "green" technologies and the defense industry from China. In some positions, as in the case of magnets, this dependence reaches 98%. All this may well be used as a lever, to which Brussels and individual EU states by and large have no counterbalance.
In fact, this conflict is teaching a lesson in a new geopolitical reality. Europe's attempt to take away a critical asset by force backfired, as it risked disrupting the supply chain on which the EU's own industry depends. In the global economy, interdependence can be asymmetric, as this case has shown.
By defiantly allowing the export of chips, China has shown that it has significant leverage and is able to use the EU's economic dependence as an instrument of political pressure. Of course, the crisis is not over yet, and the confrontation may be resumed under new pretexts. But it is doubtful that after the preliminary settlement of trade issues between the United States and China, Washington will also aggressively put pressure on European partners. They themselves are unlikely to once again provoke Beijing, which has felt its power.
At the same time, another critical vulnerability of the EU has become clear: the countries of the Union as a whole are by no means in a strong position to defend their economic interests in the global market. And it's not just about the supply of raw materials. Obviously, Brussels has to retreat on almost all points. Apparently, in the near future, this may be confirmed by the conflict over environmental standards and gas supplies from Qatar.
Переведено сервисом «Яндекс Переводчик»
