In brief
In a response to the Netherlands' takeover of Nexperia, a Chinese chip manufacturer, China will ease its export ban on semiconductors, alleviating concerns for European automotive suppliers. This decision follows a meeting between leaders Trump and Xi and aims to address the disruption in global supply chains. However, the specifics of the exemptions for exports are yet to be detailed.
Beijing has said it will loosen a chip export ban it imposed after Dutch authorities took over Nexperia - a Chinese-owned chipmaker based in the Netherlands.
In September, the Netherlands used a Cold War era law to take over the company after citing serious governance shortcomings and to prevent the chips from becoming unavailable in an emergency.
In response, China said it would not re-export completed Nexperia chips to Europe which raised concern among carmakers. One association had described the move as alarming.
Around 70% of chips made in the Netherlands are sent to China to be completed and re-exported to other countries.
In a statement on Saturday, China said that it would comprehensively consider the actual situation of enterprises and grant exemptions to exports that meet the criteria. However, it has not specified what that could entail.
It also went on to criticise The Hague for what it called improper interference in the internal affairs of enterprises and blamed it for the current disruption of global production and supply chains.
The Dutch-controlled firm told customers it would stop sending chips back to China to be processed, according to a letter this week seen by the Reuters news agency.
Last month, the European Automobile Manufacturers' Association (ACEA) had warned Nexperia chip supplies would only last a few weeks unless the Chinese ban was lifted.
Without these chips, European automotive suppliers cannot build the parts and components needed to supply vehicle manufacturers and this therefore threatens production stoppages, the group said.
The latest plans by Beijing to relax its export controls have emerged after Donald Trump and Xi Jinping met in South Korea earlier this week.
Trump later said the leaders discussed chips, while Beijing's post-meeting readout did not explicitly mention any area of trade.
The White House is expected to release a fact sheet later today detailing its new trade agreement with China. Reuters reports that it will also announce the resumption of Nexperia exports.
In December 2024, the US government placed Wingtech on its so-called entity list, identifying the company as a national security concern.
In the UK, Nexperia was forced to sell its silicon chip plant in Newport, after MPs and ministers expressed national security concerns. It currently owns a UK facility in Stockport.
