Beijing’s Nexperia ban triggers EU diplomatic drive to protect chip supply chain
The European Union is seeking a diplomatic solution with Dutch chipmaker Nexperia after China blocked its product exports, raising fears of a global chip shortage. EU tech chief Henna Virkkunen said Nexperia has been invited to the Chips Act Task Force to assess the economic impact of the disruption.
New Delhi: The European Union is trying to find a diplomatic compromise with the Dutch chip manufacturer Nexperia, as the problem of a possible semiconductor crunch is increasing. Henna Virkkunen, the chief of EU tech, stated on Friday that the bloc was still engaged in dialogue, despite the virtual meeting they had with the Chinese-owned company. The discussions were aimed at how to make Europe more resilient in the supply chain of chips and less reliant on foreign suppliers.
Virkkunen reiterated the need to collaborate and be open and transparent, as Nexperia has been called upon to participate in the EU Chips Act Task Force. The task force is evaluating the economic impact of the disruption in supply and investigating both the short- and medium-term responses. Virkkunen affirmed our resolve to pursue a diplomatic breakthrough on X and emphasised that the resilience of the semiconductor industry in Europe should be strengthened by taking the initiative.
Dutch takeover triggers tensions
Nexperia is a company owned by Wingtech Technology of China, and it has been involved in controversy since the Dutch government decided to take over the company earlier this month. The ruling, which sought to protect the national and technological interests, caused an immediate response on the part of Beijing, which enforced a ban on the export of Nexperia products in China.
Automakers feel the pinch
The semiconductor seminar has led to panic among the semiconductor manufacturers in the world that depend on Nexperia. In retaliation Nexperia was said to have halted wafer shipments to its Chinese assembly facility, as revealed in a customer letter submitted by Reuters. Virkkunen indicated that what the episode illustrates is that Europe desperately needed to diversify, stockpile, and have stronger partnerships with its suppliers to establish a solid chip ecosystem. She concluded that Europe should be ready to experience shocks in the future and the strategic significance of independence in semiconductors.