It’s done. The Dutch have “unseized” Nexperia, suspending the very legislation they invoked with nationalistic fervor just weeks ago to wrest the crucial chipmaker from Chinese control. The reason for this abrupt reversal, delivered with a straight face, is that this will allow the Chinese authorities to resume supplying chips to Europe—chips that were only cut off in retaliation to the Dutch seizure in the first place. In effect, the Dutch government is proudly announcing that China has constructively agreed to let them surrender.
In a masterclass of political doublespeak, Dutch Economic Affairs Minister Vincent Karremans hailed the decision as a “constructive step” and a gesture of “goodwill” [1]
“We are positive about the measures already taken by the Chinese authorities to ensure the supply of chips to Europe and the rest of the world,” he stated, conveniently omitting that these “measures” were simply the cessation of economic hostilities [2]
This diplomatic theater masks a stark reality: the Netherlands, and by extension Europe, blinked. They were outmaneuvered and forced to capitulate, their industrial backbone held hostage by the very supply chains they sought to control.
A Self-Inflicted Crisis
The saga began in September when The Hague, citing “serious governance shortcomings” and the need to protect Europe’s strategic autonomy, invoked a never-before-used Cold War-era law, the Goods Availability Act, to take supervisory control of Nexperia [3]
Nexperia, a major supplier of essential chips for the automotive industry, is owned by the Chinese tech giant Wingtech. The Dutch government claimed it acted to prevent the transfer of intellectual property and assets out of Europe [2]
Beijing’s response was swift and devastating. It didn’t just issue a diplomatic protest; it turned off the tap. China blocked the export of Nexperia’s chips, most of which are packaged and finished in Chinese facilities. The very crisis the Dutch claimed to be preventing—a shortage of critical chips—was now a reality of their own making.
Date | Event | Impact |
September 30 | Netherlands seizes control of Nexperia, invoking Cold War-era law | Dutch claim to protect European strategic autonomy |
Early October | China retaliates by banning exports of Nexperia chips | Supply chain crisis begins |
October – November | European car manufacturers face supply chain turmoil | Volkswagen, Honda warn of imminent factory shutdowns |
November 9 | China lifts the export ban after back-channel talks | Pressure on Netherlands intensifies |
November 19 | Netherlands formally suspends its seizure order | Dutch government hails it as “diplomatic success” |
Europe's Industrial Choke Point
The retaliatory export ban sent shockwaves through Europe’s automotive industry, which is critically dependent on Nexperia’s components. Volkswagen and Honda saw their supply chains thrown into chaos, with production pauses reported as far away as Mexico [2]
The European Automobile Manufacturers’ Association (ACEA) warned that its members were just “days away” from crippling production stoppages [2].
The message from Beijing was clear: you can have your laws and your strategic autonomy, or you can have a functioning car industry. You can’t have both.
Faced with the prospect of shuttered factories and a spiraling economic crisis, the Dutch government’s tough talk quickly evaporated. The “constructive dialogue” they now praise was, in reality, a negotiation for the terms of their own surrender. China had demonstrated its absolute leverage over a critical European industry, and Europe had no choice but to fold.
While the Dutch government may try to spin this as a win, the facts on the ground tell a different story. They picked a fight they couldn’t win and were forced into a humiliating retreat. The Nexperia episode serves as a stark lesson in the new realities of global economic power: in the 21st century, the most potent weapons aren’t always military. Sometimes, they’re just tiny pieces of silicon.
References
[1] BBC News: Dutch government suspends intervention into chipmaker Nexperia
[2] The Guardian: Netherlands suspends state seizure of Chinese chipmaker Nexperia
[3] The Telegraph: China handed control of crucial chip factory after stand-off with Dutch
