Recently, in response to the possibility of ASML (ASML Holding N.V.) potentially relocating some of its operations overseas, the Dutch government has proposed an ambitious plan to allocate €2.5 billion, equivalent to approximately 19.5 billion RMB, in financial support to retain this tech giant. This move not only reflects the Dutch government's determination to maintain the country's leading position in technological innovation but also reveals the reality that, in the context of intensifying global competition for technological dominance, governments are willing to take extreme measures to retain key technology companies.

01

The Netherlands: Cherishing in Palm

The Dutch government has established a special task force, codenamed "Beethoven Plan," led personally by Dutch Prime Minister Mark Rutte, with the sole purpose of retaining ASML and allowing it to continue its development in the Netherlands. This plan, known as "Operation Beethoven," primarily aims to prevent ASML from moving abroad to attract talented employees. ASML manufactures machinery for producing semiconductor chips.

The funding will be provided by the Dutch government and the surrounding areas of Eindhoven in the eastern Netherlands, where ASML is located.

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According to the Dutch News Agency, the Dutch Minister of Economic Affairs, Micky Adriaansens, said, "This is one of the most important companies in the Netherlands and a global player. ASML is like our Messi, a star player like Messi can bring an entire team."

ASML is concerned that a reduction in immigration, including technical workers, will force it to look elsewhere. Geert Wilders, the far-right leader who won the November elections, had promised to reduce immigration.

In January of this year, ASML's Chief Executive Officer, Peter Wennink, said during the company's annual report release, "If we can't get people to come here, then we will send people elsewhere. It's as simple as that." Wennink stated, "We are a global company. We will go where we need to go to ensure the company can grow and serve our customers. If the Netherlands closes its borders, it would prevent us from receiving immigrants or foreign students."

The recently announced funding will be used to invest in talent development, making the region more attractive for living and working, and will also address concerns about electricity supply shortages. The Dutch government said, "With the implementation of these measures, the government believes that ASML will further invest in the Netherlands and retain its legal, tax, and actual office registration in the country."ASML has 42,000 employees worldwide, more than half of whom work within the Netherlands. Among these employees, a significant portion comes from abroad.

The "Brainport" region is hailed as the "Silicon Valley" of the Netherlands, home not only to ASML but also to multiple technology companies such as Philips.

The Netherlands has long been considered a good place to do business, with a liberal economy and a well-educated, English-speaking workforce.

However, a report published by the Dutch Employers' Association in February indicated that the business environment is deteriorating. The report stated that nearly half (44%) of the surveyed entrepreneurs do not consider the Netherlands an attractive country for business, and nearly 20% are considering leaving the country.

A year ago, these percentages were 28% and 13%, respectively.

After Wilders and his party, the Party for Freedom, won the elections, the biggest concern expressed by entrepreneurs is the fear of political instability. The current political situation in the Netherlands is not clear, and the Party for Freedom is currently negotiating with three other parties on a plan, a process that will take several months and does not guarantee the formation of a stable government.

Recently, industry giants such as the consumer goods company Unilever and the energy giant Shell have relocated out of the Netherlands, causing a shock in the Dutch business community. However, Unilever may list its ice cream business on the Amsterdam Stock Exchange after spinning it off from its core operations.

Dutch Prime Minister Rutte, who visited China at the end of March for a working visit, stated that the Netherlands' export control measures will not specifically target any one country and will strive to minimize their impact. Prime Minister Rutte said, "Regarding our semiconductor industry and companies like ASML, I can tell you that when we have to take measures, they will by no means target any one country specifically. We are constantly working to ensure that the impact is limited and does not affect the supply chain, thus avoiding any impact on overall economic relations."

Is the Dutch government wishful thinking, or does it align perfectly with ASML?ASML: Time to Move On

It is evident that ASML is unwilling to cooperate and may soon reach a breaking point. In early March, ASML suddenly announced its intention to "relocate" from the Netherlands, considering moving its headquarters to another country.

The official reason given by ASML for this move is dissatisfaction with the Dutch government's tightening immigration policies. However, it is clear to observers that the real issue lies in the Dutch government's inability to withstand pressure from the U.S. government, leading to compromises and the implementation of a series of export bans on high-end lithography equipment to China. This has caused ASML's business in China to plummet, with a very bleak outlook.

Dutch Minister of Economic Affairs, Micky Adriaansens, confirmed in an interview that she plans to meet with ASML's CEO, Peter Wennink. "I don't know if they will leave the Netherlands. They want such significant growth, which puts pressure on our infrastructure. That's why we are having very intensive conversations with them. Because we want to understand, can we solve this problem?"

In November last year, the Party for Freedom, led by the far-right populist Geert Wilders, won a major victory in the Dutch parliamentary elections. Known as the "Dutch Trump," Wilders has expressed his desire to become the next Prime Minister of the Netherlands. He has repeatedly stated that if in power, he would focus on curbing immigration, including measures such as limiting the number of overseas students and reducing tax breaks for foreigners. He openly opposes Islam and the European Union and supports a referendum on "whether the Netherlands should leave the EU." This has a significant impact on ASML's development.

Among ASML's total of 23,000 employees in the Netherlands, approximately 40% are non-Dutch, and overseas students staying in the Netherlands for employment are one of the main sources of labor for the company. The "obvious rightward shift" of the Dutch government has raised concerns for ASML. In January of this year, Wennink warned that ASML is highly dependent on skilled foreign labor and high-quality foreign workforce, and stated that potential anti-immigration policies could prompt ASML to leave the Netherlands. Wennink said, "The consequences of restricting labor migration would be enormous. We need these people for innovation. If we can't find them here, we will have to go to other places where we can develop."

At that time, some media reported that France might be a destination for ASML's expansion. Regarding rumors of "leaving the Netherlands," an ASML spokesperson recently stated to the media that, due to concerns about the deterioration of the business environment in the Netherlands, ASML is actively considering the company's future.

03

How to Retain a "King"

Lithography machines are key equipment for manufacturing electronic chips for mobile phones, computers, and other devices. ASML is the world's largest producer of lithography machines, holding up to 80% of the market share for high-end lithography equipment. ASML is the sole global supplier of EUV lithography equipment needed by global chip manufacturers to produce the most advanced process chips, such as 3nm, 5nm, and 7nm chips. How can the Netherlands, a leading powerhouse, retain such a dominant position?The Chip Act seems to be the most official, direct, and concentrated approach, offering financial incentives to keep you here. The government can reduce the operating costs of major semiconductor manufacturers through tax breaks, R&D subsidies, and loan preferences, thereby enhancing their profitability and competitiveness. At the same time, the government can also establish special funds to support innovation and development in the semiconductor industry.

Strengthen industry planning and layout: The nation should formulate a clear development plan for the semiconductor industry, specifying the development goals, key tasks, and supportive policies. By optimizing the industrial layout, the semiconductor giants can be guided to form a clustering effect in key areas and regions, enhancing the overall competitiveness of the industry.

Enhance talent cultivation and introduction: The semiconductor industry is highly knowledge-intensive, with a large and demanding need for talent. The country should increase its efforts in cultivating talent for the semiconductor industry and actively attract outstanding overseas talents to provide ample human resource support for major semiconductor manufacturers. Additionally, these manufacturers involve a significant amount of patents and intellectual property rights in their R&D and production processes. The government should strengthen the protection of intellectual property rights, combat infringement, safeguard the legitimate rights and interests of major semiconductor manufacturers, and stimulate their innovative vitality.

According to Dutch media reports, ASML CEO Peter Wennink stated in an interview with the Dutch media network RTL that if the company cannot find enough qualified personnel in the Netherlands, it may be forced to move its operations abroad. He added, "We will find these people in Eastern Europe, Asia, or the United States, and then we will go there." Clearly, local talent has a significant impact on retaining major manufacturers.

Promote in-depth integration of industry, academia, research, and application: The government should actively promote cooperation between the semiconductor industry and universities, research institutions, and strengthen the in-depth integration of industry, academia, research, and application to facilitate technology transfer and the transformation of research outcomes. At the same time, encourage cooperation between major semiconductor manufacturers and downstream enterprises to promote collaborative development along the industry chain.

Optimize the business environment: The government should simplify the approval process, improve administrative efficiency, and reduce the operating costs of enterprises. At the same time, strengthen market regulation and maintain a fair competitive market environment to provide a stable and predictable business environment for major semiconductor manufacturers.