Concerns have emerged over whether China has acquired advanced EUV lithography machines, critical for high-end chip production. While the U.S. government has raised alarms, ASML and Dutch officials maintain that such a scenario is impossible, as they track every unit of the 340 machines produced to date.
The Dispute Over EUV Lithography Access
Since 2019, the United States has maintained a strict campaign to block China from accessing extreme ultraviolet (EUV) lithography machines. These systems, manufactured exclusively by the Dutch company ASML, are the foundational technology required to print the ultra-powerful chips that drive modern artificial intelligence systems. The tension intensified recently when U.S. Commerce Secretary Howard Lutnick hinted that an EUV machine might have reached Chinese territory, a claim that would represent a significant breach of international export controls.
ASML has countered these allegations with technical data. According to a report by The Economist, the company monitors the location of all 340 EUV machines it has ever manufactured, including 26 that have been decommissioned. The firm insists that none of these machines are located in China. Furthermore, the company maintains that it is the only entity capable of transporting such sensitive equipment, and its own engineers manage the installation and handling of all components shipped to clients. These machines are considered the most important industrial tools in the world, requiring a vast number of complex parts and the capacity of three Boeing 747 cargo planes to transport when disassembled. Each machine weighs approximately 180 tons and is roughly the size of a double-decker bus or two large rooms.
Dutch Export Policy and Industry Skepticism
The Dutch government has sought to de-escalate the diplomatic friction resulting from the U.S. claims. During a visit to Washington in late June, Dutch Minister of Trade Sjoerd Sjoerdsma met with Lutnick and members of Congress to reiterate that the Netherlands is enforcing stringent export controls on sensitive technologies, consistent with U.S. restrictions. Despite these reassurances, the U.S. allegations have left a lingering sense of uncertainty.
Industry insiders suggest that while a full EUV machine reaching China is highly improbable, the possibility of individual components or older technology moving through third-party channels cannot be entirely dismissed. Experts in the semiconductor industry note that while it is unlikely a complete unit has reached China, they do not rule out the transfer of specific components via ASML suppliers or external parties. Some analysts believe the real U.S. concern may actually focus on the older deep ultraviolet (DUV) lithography machines. Unlike EUV systems, DUV machines and their associated spare parts and services are often exempt from the most restrictive export bans. Notably, sales related to DUV technology accounted for roughly one-third of ASML’s revenue in 2025.
Maritime Tensions and Regional Risks
While the technology war continues, geopolitical friction in the South China Sea has escalated in parallel. An analysis of vessel-tracking data provided by Starboard Maritime Intelligence regarding over 100 Chinese ships—including at least 45 linked to state-backed entities like the Coast Guard and maritime militias—reveals that Chinese activity near Vietnamese-controlled outposts has nearly doubled. In the twelve months ending April 30, 89 Chinese vessels passed within 10 nautical miles of three specific sites—Sand Cay, Namyit, and Petley Reef—compared to 50 vessels during the same period three years prior.
Phuong added that expanding these islands is an activity that would increase the chances of a naval confrontation. These sites sit along a strategic corridor for global trade valued at trillions of dollars annually. According to Bloomberg Economics, any significant disruption to trade in this region could potentially reduce global GDP by 1.9 percent, or nearly two trillion dollars.
Economic and Security Outlook
The convergence of technological export controls and maritime territorial disputes creates a complex environment for global markets. Vietnam, while attempting to assert its sovereignty, is simultaneously seeking smoother relations with Beijing to secure energy supplies, particularly as global fuel markets remain volatile. Filipino Defense Secretary Gilberto Teodoro Jr. recently remarked, I already see a broader reaction against China, adding that the Philippines and Vietnam have developed a level of trust that contrasts with Beijing’s actions. As nations navigate these competing pressures, observers are watching for further developments in export policy from the Netherlands and any shifts in naval patrol patterns in the South China Sea, which remain key indicators of potential conflict escalation.
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