Nexperia row shows how China is weaponising EU relationship — and winning

A new front in Europe’s economic contest with Beijing

The dispute between Brussels and the Chinese-owned chipmaker Nexperia has become more than a trade disagreement — it is fast becoming a test case for how Europe intends to navigate its most delicate geopolitical relationship. The controversy over the Dutch semiconductor firm, bought by China’s Wingtech in 2019, has reignited a familiar European dilemma: the desire for open markets and inward investment colliding with the fear of strategic dependency.

In recent weeks, the European Commission has found itself under renewed pressure from member states and Washington to assert control over Chinese investment in critical industries. The Nexperia case, centred on its acquisition of a major chip factory in the Netherlands, encapsulates the issue. The Dutch government, echoing U.S. concerns, is exploring whether Chinese ownership poses national-security risks. Beijing, meanwhile, has accused Europe of politicising trade and threatening fair competition.

Semiconductors and the new balance of power

At stake is not only control over a single factory but the broader balance of power in an era where semiconductors are the new oil — vital to cars, defence systems, and artificial intelligence. For years, Europe’s dependency on Asian manufacturing was seen as an acceptable trade-off for lower costs and stable supply. But the pandemic, followed by Russia’s war in Ukraine, changed the calculus. Supply-chain resilience has become a strategic priority, and Europe’s leaders now talk of “technological sovereignty” with a new urgency.

Yet the reality remains complicated. European industry, from carmakers in Germany to electronics manufacturers in France, continues to rely heavily on Chinese inputs. Cutting ties would mean rewriting decades of integration. Beijing knows this — and has shown a willingness to exploit Europe’s divisions. When Brussels launched its anti-subsidy probe into Chinese electric vehicles earlier this year, China responded with veiled threats against European exports. Few doubt that Nexperia is part of the same strategic chessboard.

Europe’s divided approach to risk

For the European Union, the challenge is compounded by uneven political will. Some member states, especially in Eastern Europe, still welcome Chinese capital as a source of jobs and infrastructure. Others, like the Netherlands and Germany, are pivoting sharply towards security-first industrial policy. The Commission finds itself mediating between the two — a task made harder by the lack of a unified defence or intelligence framework.

In corporate circles, the affair has sown unease. Executives fear a creeping politicisation of business decisions. The message from Nexperia is that Europe is no longer the predictable environment it once was. Meanwhile, China’s state media portray the episode as evidence of European hypocrisy — a continent that lectures on free trade while practising protectionism. The narrative is gaining traction, particularly among countries in the Global South who see the EU’s approach as an extension of Western bloc politics.

A continent learning the cost of openness

The irony is that Europe’s attempt to reduce vulnerability may in the short term deepen it. By tightening scrutiny of Chinese investment without yet achieving full semiconductor self-sufficiency, the EU risks alienating both its biggest supplier and its most promising growth market. The global chip war is not just about who fabricates wafers, but who controls influence — and for now, China appears more comfortable operating in that grey zone than Europe.

Behind closed doors in Brussels, officials admit that Europe’s economic model — open, rules-based, multilateral — is being tested as never before. The Nexperia dispute may seem parochial, but it speaks to a deeper reckoning. Can Europe remain a liberal trading power in an age of weaponised interdependence? Or must it accept that the global order it helped build no longer plays by its rules?

For now, China seems to be winning the slow game. It is not that Europe lacks resolve, but that its own structure — consensual, multi-layered, cautious — is ill-suited to confrontation. The Nexperia saga, then, is not just a case about chips. It is the story of a continent learning the cost of its own openness.