China Urges Netherlands to Not Politicize Trade

The president of China Xi Jinping has invited Netherlands Prime Minister Mark Rutte to visit Beijing next year, following a bilateral meeting at the G20 conference in Bali in which Xi asked the Netherlands not to politicize trade.

Xi’s remarks were an obvious reference to U.S. calls for allied countries including the Netherlands to adopt U.S. restrictions on exporting semiconductor manufacturing equipment to China.

“The Prime Minister received an invitation to come to China again, so those are steps in the continual political, diplomatic discussions,” Dutch Finance Minister Sigrid Kaag said in an interview with BNR radio following the meeting, which she also attended, on Tuesday.

A representative from Rutte’s office said details of the possible visit to China were still being determined. According to an official readout of the bilateral meeting published on the website of the Chinese foreign ministry, Xi asked Rutte to resist “the politicization of economic and trade issues and maintain the stability of global supply chains”.

China is the Netherlands’ second biggest trade partner after Germany, according to the Dutch statistics office CBS. The Netherlands’ largest company, ASML Holding NV (ASML.AS), is a chief maker of semiconductor equipment, with more than 2 billion euros ($2.1 billion) of sales to customers in China in 2021.

In a Nov. 3 appearance on CNBC, U.S. Commerce Secretary Gina Raimondo said she anticipated that allied countries to embrace policies unveiled by the Biden administration in October. “I think you’ll see Japan and the Netherlands follow our lead,” she said. Dutch trade policy is generally set at the European level but since 2018, The Hague has denied ASML licenses to export its most advanced products to China, as they are thought of as dual-use equipment with possible military applications.

Nonetheless, a few types of equipment now restricted by the United States is not designated as dual use. ASML, whose machines contain few U.S. parts, has said it intends to continue shipping that kit.