China has permitted Nexperia, a semiconductor company based in the Netherlands and owned by Chinese firm Wingtech, to export certain chips. This decision was made to address concerns among European carmakers about potential production delays, as reported by the BBC.
In October, the Dutch government temporarily took over Nexperia to safeguard Europe’s chip supply and address governance concerns. This move led China to block exports of Nexperia’s finished chips. Now, China has agreed to simplify export procedures and remove licensing requirements for Nexperia products intended for civilian use, according to EU Trade Commissioner Maroš Šefčovič. He also added that talks with Chinese and Dutch officials are continuing to ensure the semiconductor supply stays stable and predictable.
Although Nexperia is based in Europe, approximately 70% of the chips it produces are sent to China for final assembly and processing. After that, they are shipped all over the world, mainly back to Europe, where they play a crucial role in the automotive industry.
Before the restrictions were lifted, many auto companies in Europe were concerned that they might face chip shortages, which could impact their production. The European Automobile Manufacturers’ Association (EMEA) had also warned about risks related to chip supplies.
In addition to its decision on Nexperia, Beijing also announced that it will pause its ban on exports of essential semiconductor materials such as gallium, germanium, antimony and super-hard materials to the U.S. for a year. Furthermore, China has suspended port fees for American ships for the same period.
All of this followed negotiations between Presidents Xi Jinping and Donald Trump in South Korea to lower tariffs and pause new trade restrictions for a year, reflecting a shift in trade tensions between China and the U.S.
