China’s EUV Breakthrough Challenges Western Chip Assumptions

In a development that could reshape the global semiconductor landscape, Chinese scientists have reportedly built a working prototype of an extreme ultraviolet (EUV) lithography machine, a technology long considered beyond China’s near-term reach. The breakthrough, first reported by Reuters, directly challenges assertions by Europe’s leading chip-equipment maker that China was “many years” away from mastering such systems.

EUV lithography is critical for manufacturing advanced semiconductor chips that power artificial intelligence, next-generation smartphones, and sophisticated defence systems. Until now, ASML has held a near-total monopoly over this technology, with each EUV machine costing around $250 million and taking decades to perfect.

According to Reuters, China’s prototype—completed in early 2025 and currently undergoing testing—was developed in a high-security laboratory in Shenzhen. The machine reportedly occupies nearly an entire factory floor and has successfully generated extreme ultraviolet light, a core requirement of EUV systems. While it has not yet produced commercial-grade chips, sources familiar with the project say China aims to achieve this by around 2028–2030, far sooner than many Western analysts had predicted.

The effort is described as part of a six-year, state-backed initiative likened to “China’s Manhattan Project,” involving thousands of engineers, research institutes, and companies. Huawei is said to play a key coordinating role. The programme reportedly operates under China’s broader semiconductor self-sufficiency strategy overseen by senior leadership close to Xi Jinping.

Notably, Reuters reports that several retired, Chinese-born former ASML engineers were recruited to the project, some allegedly working under assumed identities to maintain secrecy. These engineers are said to have reverse-engineered critical elements of EUV technology, accelerating progress.

Analytically, while the prototype does not yet threaten ASML’s commercial dominance, it signals that export controls and technology restrictions may be slowing—but not stopping—China’s semiconductor ambitions. If successful, the project could significantly alter global supply chains and challenge long-held assumptions about technological containment in the chip industry.