Technology’s geopolitical dimension is rapidly transforming the global economy — shaping economic narratives, building alliances, ushering in supply-chain wars, influencing innovation and research worldwide, and even impacting the way ordinary people live.
In this series of interviews on “Technology Geopolitics,” Vision Times Senior Reporter Venus Upadhayaya interviews technology experts and geopolitical analysts to bring our readers diverse perspectives on the forces shaping contemporary, technology-driven geoeconomics.
This is the first interview in the series, focusing on China’s recent acquisition of advanced DUV lithography machines and what it means for the global chip industry.
“China’s ability to manufacture its own immersion DUV machines effectively undercuts the Western containment strategy, allowing domestic foundries to continue scaling mid-to-high tier chip production independently,”Dr. Danish Faruqui, the CEO of Fab Economics & Co-Chair of Global Semiconductor Policy Council (GSPC)
A Deep Ultraviolet (DUV) lithography machine is an advanced semiconductor manufacturing system that can print minuscule circuit patterns onto silicon wafers.
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ASML, a Dutch company, is the world’s dominant manufacturer of Deep Ultraviolet (DUV) and Extreme Ultraviolet (EUV) lithography machines — ultra-precise systems used to “print” the intricate patterns that form computer chips.
These chip-printing machines use light to draw microscopic circuit patterns onto silicon wafers, a process known as lithography. The main difference between DUV and EUV lies in the wavelength of light they use to print these patterns. Most advanced chips are manufactured using a combination of DUV and EUV lithography, with each chip containing multiple layers produced using these technologies.
The DUV segment includes lithography tools that can cost up to US$60 million each. ASML has a market share of more than 80 percent in this category, according to Reuters. The company also has a monopoly in the cutting-edge EUV segment, where each tool can cost up to US$200 million. EUV machines are used to manufacture many of the world’s most advanced AI chips and leading-edge memory chips.
While ASML is the only commercial manufacturer of EUV lithography machines, it faces competition from Nikon and Canon in the DUV segment. This is also where China’s latest technological advances are attempting to make inroads.
In what was previously a highly exclusive manufacturing sector, China entered the field this year with the production of domestically developed immersion DUV machines, according to a Reuters report published in July.
China’s entry into this exclusive supply chain is highly sensitive because the Netherlands, home to ASML, the world’s only commercial manufacturer of EUV lithography machines, and the United States have both restricted China’s access to advanced semiconductor technology. EUV machines are enormous systems, with some reportedly comparable in size to a school bus.
The United States introduced its semiconductor export-control regime on Oct. 7, 2022, restricting “the People’s Republic of China’s (PRC’s) ability to both purchase and manufacture certain high-end chips used in military applications and build on prior policies, company-specific actions, and less public regulatory, legal, and enforcement actions taken by BIS [Bureau of Industry and Security],” according to a statement by the U.S. Department of Commerce. These restrictions were further tightened a year later.
Similarly, the Dutch government introduced an export-control regime on Sept. 1, 2023. In an official statement, it said that its “national authorisation requirement stipulates that, from now on, companies will have to apply for an authorisation when exporting this type of advanced manufacturing equipment.”
The restrictions effectively prevented China from purchasing ASML’s most advanced extreme-ultraviolet (EUV) lithography systems, while Dutch export controls also restricted China’s access to certain advanced DUV lithography equipment, according to a Reuters report. The restrictions have pushed China towards greater self-sufficiency in semiconductor manufacturing. At the same time, China remains a major revenue generator for ASML, accounting for 16 percent of the company’s net sales in the first half of 2026.
To understand the wider geopolitics embedded in semiconductor manufacturing and global supply chains—particularly China’s recent entry into DUV lithography manufacturing—Vision Times Senior Reporter Venus Upadhayaya interviewed Dr. Danish Faruqui, CEO of Fab Economics, a U.S.-based advisory firm specializing in semiconductor greenfield fab and ATP projects. Dr. Faruqui is also Co-Chair of the Global Semiconductor Policy Council (GSPC), a think tank focused on the competitive geopolitics and geoeconomics of semiconductors across different regions of the world.
Dr. Danish Faruqui: Per Fab Economics review – The commercial and market significance of China mass producing immersion deep-ultraviolet (DUV) lithography machines via Shanghai Aishengna Electronic Technology Group centers on breaking Western monopoly chokeholds and reshaping the long-term revenue outlook for global semiconductor giants like ASML.
While these domestic tools are not yet advanced enough to compete with ASML’s elite extreme ultraviolet (EUV) systems, this development carries massive structural weight across the global tech market — causing ASML’s stock to tumble 10 percent and wiping out €60 billion in market value over two trading sessions.
If Chinese foundries like SMIC [Semiconductor Manufacturing International Corporation] and Changxin Memory Technologies (CXMT) can source viable, multi-million-dollar DUV tools locally, ASML risks losing its primary remaining foothold in the region. However, the immediate impact is limited due to the huge disparity in Production Scaling between ASML and SAETG [Shanghai Aishengna Electronic Technology Group]: China aims to manufacture just 5 immersion DUV tools this year and 20 by 2027. For context, ASML shipped 131 comparable systems in 2025 alone.
Dr. Danish Faruqui: Secondly per GSPC review – The United States, alongside the Netherlands and Japan, has heavily restricted the export of advanced immersion DUV and EUV tools to China to bottleneck its semiconductor and AI growth. China’s ability to manufacture its own immersion DUV machines effectively undercuts the Western containment strategy, allowing domestic foundries to continue scaling mid-to-high tier chip production independently.
While these new Chinese-made machines are fundamentally DUV (using 193-nanometer light) and not a direct replacement for ASML’s elite 13.5-nanometer EUV systems, they give China a geopolitical workaround. Armed with sovereign immersion DUV tools, Chinese foundries like SMIC can deploy complex multi-patterning techniques to produce 7-nanometer (and potentially smaller) processors. Though this method is highly complex, yields fewer working chips, and costs more than using an EUV machine, from a geopolitical standpoint, viability matters more than efficiency.
Dr. Danish Faruqui: When Chinese foundries — such as SMIC, Hua Hong, and Changxin Memory Technologies (CXMT) — procure advanced immersion DUV (deep-ultraviolet) tools, it fundamentally changes their manufacturing blueprint. Without EUV machines, which can print complex, nanometer-scale designs in a single exposure, Chinese chipmakers must use immersion DUV machines for a process called multi-patterning.
Instead of printing a circuit layout all at once, the DUV machine exposes the wafer multiple times using different photomasks utilizing SAQP and OAQP methods. While multi-patterning allows Chinese foundries to manufacture advanced processors, it
introduces severe manufacturing penalties compared to standard global foundries (like TSMC or Samsung); Lower Yields: Every extra exposure step increases the probability of microscopic alignment errors, defects, and ruined chips.
Throughput Bottlenecks: Passing a wafer through a DUV scanner four or five times drastically slows down the production line. Fabs require more time, electricity, and chemical materials to produce the same volume of chips.
High Production Costs: Because many chips on the wafer turn out defective, the cost per working chip skyrockets. It is a commercially inefficient process, sustained only by aggressive state subsidies.
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