All important strategic materials could be used as a weapon against the European Union, Trade Commissioner Maroš Šefčović told Euronews in an exclusive interview.
The EU is dealing with the fallout from the Dutch government’s acquisition of semiconductor maker Nexperia on national security grounds. The move from The Hague sparked a clash between Europe and China over who would control the company and its final products, resulting in restrictions on chip exports by China.
Šefčović, an experienced politician who oversees the EU’s vital trade portfolio, said the episode highlighted the complexity of global supply chains and the risks associated with significant dependence on third countries outside the EU.
“This very much underlines the lessons we have learned over the past few years, and it is not just about China. Today everything can be weaponized,” Šefčović told Euronews. For Europe, he argued, “It started with[Russian]gas, followed by critical raw materials and high-end and low-cost chips, all of which can be weaponized.”
Mr Šefčović has been in contact with authorities in China and the Netherlands since the altercation began more than a month ago. The Dutch government took control of Nexperia on September 30, fearing that the company would be broken up and moved to China. Dutch authorities remain concerned that the move could also involve the transfer of sensitive technology.
China responded by blocking chip exports, raising concerns in Europe and around the world about a possible global shortage of automotive chips.
The impasse eased on October 30 after China and the United States met in South Korea and both sides agreed to a truce in their bilateral trade dispute.
“China is taking appropriate steps to ensure that trade resumes from Nexperia’s facilities in China so that critical chip production can flow to other parts of the world,” the White House said in a statement.
Šefčović suggested that a partial recovery in exports marked the beginning of a resolution to the conflict, but reiterated that the fiasco was a warning of the urgent need to diversify.
“We have received information from car manufacturers to spare parts manufacturers that they are getting these chips,” he told Euronews.
“However, we are only at the beginning of resolving this issue and will continue our discussions with our Dutch colleagues and the Chinese authorities.”
Vincent Kallemans, the Dutch envoy at the center of the turmoil with Beijing, said in an interview that he would do it again in the same way, suggesting the incident was a warning about the deep dependence Europe has built over the years.
EU preparing new principles for economic security
The Nexperia case is the latest case between China and the EU over the supply of strategic parts used in everything from automobiles to defense.
It also highlights how these materials have become political tools to exert economic pressure. After weeks of tensions that affected European industry, the EU has struck a deal with China that eases restrictions on some rare earth exports.
The European Commission is developing a plan to address some of these weaknesses, due to be submitted next month. Šefčović said the global race to secure rare earths, critical components and stable supply chains requires a unified approach.
“We need to do a little bit more like Japan, which has stockpiled some of the key raw materials, key technology and key chips,” Šefčović said.
“I think this will be one of the lessons that we hope to incorporate into the new economic security principles that we will present by the end of the year.”
The EU is actively pursuing policies to reduce risks, but not to decouple from China. This will allow the EU to apply safeguards in key areas considered strategic and close loopholes to the single market while keeping the door open to trade.
“Economic security and effective export controls will only work if they are applied homogeneously and harmoniously across the EU,” Šefčović said.
“Those who try to exploit this system will inevitably find a weakness and penetrate the European market, putting the entire European economy at risk,” he concluded.
