China’s Tech Still Constrained by Export Controls, ASML’s CEO Says

VELDHOVEN, Netherlands – DeepSeek's success shows companies are making the most of limited resources in a hot artificial-intelligence market, but that doesn't mean controls targeting China's chip sector have failed, the chief of a leading semiconductor equipment maker said in an interview.
Peter Wennink, CEO of ASML Holding NV, emphasized that while Chinese companies have shown remarkable ingenuity in working within constraints, export controls continue to effectively limit China's access to cutting-edge semiconductor technology.

"What we're seeing is impressive adaptation, not a breakthrough that undermines the controls," Wennink explained. "Chinese companies are optimizing what they have access to, but they remain several generations behind in advanced chip manufacturing capabilities."
The comments come amid growing attention on DeepSeek, a Chinese AI startup that recently demonstrated the ability to train large language models more efficiently than its Western counterparts, despite limited access to advanced AI chips.

ASML, which holds a virtual monopoly on the extreme ultraviolet (EUV) lithography machines essential for producing the most advanced semiconductors, has been directly affected by Western export controls aimed at China's chip sector.

Wennink noted that while China has made progress in certain areas of chip design and manufacturing, the inability to access EUV technology creates a fundamental ceiling for their semiconductor advancement. "You can optimize existing processes, but without EUV, you simply cannot produce chips at the 5-nanometer node or below at scale."

The CEO's assessment suggests a nuanced view of China's technological capabilities – acknowledging their ability to innovate within limitations while maintaining that export controls are achieving their strategic objectives.

Industry analysts agree with this assessment. "What DeepSeek has accomplished is impressive, but it doesn't change the fundamental technological gap in semiconductor manufacturing," says Sarah Chen, semiconductor analyst at Morgan Stanley. "They're making the most of older-generation chips, but that's different from closing the gap in leading-edge technology."

The situation highlights the complex balance between innovation and technological constraints in the global semiconductor industry. While Chinese companies have demonstrated remarkable ability to optimize existing technologies, the lack of access to advanced manufacturing tools continues to limit their capability to compete at the cutting edge.

ASML's perspective carries particular weight given its unique position in the semiconductor industry. As the only company capable of producing EUV lithography machines, its assessment of technological capabilities and limitations is closely watched by industry observers and policymakers alike.

Looking ahead, Wennink expects the technological gap between China and leading-edge manufacturers to persist as long as export controls remain in place. "The pace of advancement in semiconductor technology means that working with previous-generation equipment puts you at an inherent disadvantage that's very difficult to overcome."

The implications extend beyond just semiconductor manufacturing to the broader technology landscape, particularly in AI development. While companies like DeepSeek demonstrate that innovation can occur within constraints, the underlying hardware limitations continue to shape the competitive dynamics of the global tech industry.