China 'greatest threat' to Dutch economic security, Dutch intelligence says

China is the greatest threat to Dutch economic security, the Netherlands' intelligence service said on Monday in an annual assessment of threats it said included commercial espionage and covert investments.

Citing Russia's invasion of Ukraine, it also said Russia was a major threat to national security.

While the Netherlands regards China as a major trading partner, its military ambitions are driving attempts to obtain Dutch and Western technologies, the agency known by its acronym AIVD, said in its 2022 annual report.

"Chinese companies and knowledge institutions sometimes are valued partners for Dutch institutions. At the same time, the country forms the greatest threat to Dutch economic security," the agency said.

"China uses both legitimate investments, corporate takeovers and academic cooperation, as well as illegal (digital) espionage, insiders, covert investments and illegal export. Dutch companies, knowledge institutions and scientists are regularly victims of this," the AIVD said.

A prime target is the semiconductor equipment maker ASML , based in the southern Dutch city of Veldhoven, which is the world's dominant supplier of lithography machines used to make computer chips. China is ASML's third-largest market.

On March 8, the Netherlands' government said it would introduce rules to restrict exports of semiconductor technology, broadly in line with U.S. regulation rolled out in October 2022 that was intended to hobble China's ability to make its own semiconductors.

The technical details of the policy are still unknown, but ASML said in March it expects a new licensing requirement for some of its advanced tools.

The AIVD said in February Russia had spied on wind turbine farms and infrastructure in the Dutch North Sea with an eye to possible sabotage, and in 2022, the Dutch government expelled 17 Russian intelligence agencies.