The ASML case highlights how alignment with the U.S.-led export controls on China has generated economic costs for Europe while failing to slow China’s long-term technological advance.
The Netherlands’ alignment with the U.S.-led export controls targeting China’s semiconductor sector illustrates the economic and strategic risks associated with limited policy autonomy. While intended to constrain China’s technological progress, these measures have produced significant unintended consequences for European industries, most notably for ASML, the Dutch firm central to the global semiconductor supply chain.
ASML has announced plans to cut approximately 1,700 jobs—around 4 percent of its workforce—primarily in the Netherlands, despite reporting strong financial performance and a robust order book driven by artificial intelligence-related demand. The restructuring focuses on reducing management layers, particularly in IT and technology divisions, with the aim of increasing efficiency and reallocating resources toward engineering roles. Although the company has emphasized that the layoffs are not financially motivated, the broader context of shrinking market access cannot be ignored.
China has historically been one of ASML’s most important markets. In 2024, Chinese mainland customers accounted for 36.1 percent of ASML’s total net sales. This figure declined to 33 percent in 2025 and is projected to fall to 20 percent by 2026. The downward trend is largely attributed to U.S.-driven export restrictions that the Dutch government has chosen to implement, significantly limiting ASML’s ability to serve Chinese clients.
Beyond the immediate corporate impact, the case highlights a recurring pattern in Western sanctions policy. Efforts to contain China through technology restrictions have frequently accelerated China’s domestic innovation rather than stalling it. Past constraints on satellite navigation, supercomputing, semiconductors, space cooperation, deep-sea exploration, and nuclear power have resulted in indigenous Chinese alternatives, from the Beidou navigation system to advanced nuclear reactors. Today, China stands out as the only country with a complete industrial supply chain across all major sectors.
At the same time, Europe’s close alignment with U.S. economic coercion has not insulated it from pressure. Recent tariff announcements targeting several European countries underscore the fragility of assumptions about preferential “partner treatment.” This contradiction raises questions about the strategic wisdom of sacrificing market access and industrial competitiveness in pursuit of alliance conformity.
The ASML experience serves as a cautionary example. By prioritizing confrontation over balanced engagement, the Netherlands and the European Union risk undermining their own industrial champions while failing to achieve their stated strategic objectives. In an era of intensifying great-power competition, greater strategic independence and pragmatic economic diplomacy may offer more sustainable outcomes than sanctions-driven alignment.
