Talks between the two governments come a week after the Dutch state seized control of Nexperia using an emergency Cold-War era law
[LONDON] China’s Commerce Minister warned that the Dutch state’s move to take control of Chinese-owned chipmaker Nexperia has “seriously affected” the stability of the global supply chain.
The minister, Wang Wentao, urged the Dutch to urgently resolve the issue, according to a Chinese government readout of a call with Dutch Economic Affairs Minister Vincent Karremans.
The Dutch government, separately, said that it would remain in contact with Chinese authorities to work “toward a constructive solution.”
Talks between the two governments come a week after the Dutch state seized control of Nexperia using an emergency Cold-War era law. The company is a subsidiary of China’s Wingtech Technology and a key supplier of mature chips used by the automotive and consumer electronics industries.
The move heightened European trade tensions with Beijing, which retaliated by blocking Nexperia from exporting products from the company’s Chinese plant.
The action against Nexperia raised fears of disruption in the auto industry. Chip shortages are likely to hit key suppliers within a week, while the impact could spread across the entire sector within 10 to 20 days, Bloomberg has reported, according to sources familiar with the matter.
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Beijing’s retaliation shows how tensions are ratcheting up between China and Europe ahead of trade talks with the US. China has unveiled new curbs on its exports of rare earths and other critical materials, citing national security.
China and the Netherlands are “in frequent contact” about “this serious bilateral material, which risks both European and global repercussions”, EU trade chief Maros Sefcovic told reporters in the European Parliament in Strasbourg on Tuesday (Oct 21) after a video call with his Chinese counterpart.
Both parties “are fully aware the time is of the essence here as well”, he said.
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On Beijing’s recent measures to curb rare earth exports, Wang said that it was a “normal” practice to improve its export controls system, according to the ministry. He said China has consistently facilitated export approvals for EU companies.
Both sides agree to meet in Brussels using the China-EU export control dialogue mechanism. BLOOMBERG
