NETHERLANDS-Xi To Rutte: Creating Tech Barriers Leads To Confrontation

(MNI) London - Wires reporting comments from Chinese state media following a meeting between President Xi Jinping and Dutch PM Mark Rutte. Reports Xi as stating that "China is ready to import more high-quality goods from the Netherlands [and] welcomes Dutch companies to invest in China."

• Xi, "Hopes that the Netherlands will provide a fair and transparent business environment for Chinese companies."
• Xi: "Artificially creating technological barriers and cutting off industrial and supply chains will only lead to division and confrontation."
• The Sino-Dutch trading relationship has come under increased global scrutiny since 2023 when the Rutte gov't imposed export restrictions on machinery used to manufacture advanced microchips, citing security concerns. Alongside the US and Japan, the Netherlands is one of three countries in the world that produces such specialised kit, with Dutch firm ASML the largest single supplier globally of high-tech lithography equipment.
• The Dutch gov't finds itself torn between security concerns, but also protecting the interests of ASML, a major employer and contributor to the Dutch tax base. Should China begin to talk about the Netherlands as an unreliable partner it could shift its demandto other producers. ASML has also threatned to "leave" the Netherlands should its expansion be stifled by gov't export regulations.
• However, significant pressure is being applied to the Netherlands by the US and EU in an effort to 'de-risk' its supply chains with regards to China. Any about-turn could lead to a backlash (and scupper Rutte's hopes of taking over as NATO Secretary-General).