China has taken measures in response to efforts by the US and its allies to curb advancements in its chipmaking industry. The Chinese Commerce Ministry announced on Monday that it will impose export controls on gallium and germanium, two rare metals that are critical for producing semiconductors.
The new export restrictions will come into effect on August 1 and will require exporters to obtain “special permission” to ship gallium and germanium or their derivative compounds out of China. The Chinese government stated that these measures are necessary for national security reasons.
China is the largest producer of gallium in the world and is also a significant exporter of germanium. These metals are considered crucial to Europe’s economy and have been included in the European Union’s list of critical raw materials. On the other hand, the US has not produced any gallium since 1987 and has relied heavily on China for imports of the material.
This move by China comes just days after the Dutch government also imposed new restrictions on exports of advanced semiconductor equipment, aligning themselves with US efforts to block China’s access to critical technology for the development of artificial intelligence. China responded angrily to the Dutch government’s actions, accusing the US of coercing other countries to maintain its global hegemony and suppress China’s semiconductor industry.
The Chinese government urged the Netherlands to refrain from abusing export control measures and to consider the stability of the global semiconductor industry’s supply chain. It appears that these export controls on rare metals are a direct response to the curbs imposed by the US and its allies.
In an editorial published in the state-owned China Daily newspaper, it was suggested that China’s decision to restrict exports of these rare metals is a retaliation against the actions of the US and its allies. The editorial pointed out that the US holds the world’s largest germanium mines but rarely exploits them, and questioned the inclusion of certain semiconductor-related products on the Dutch export control list. It emphasized that China is defending its own legal national interests in an uncertain world.
These developments highlight the increasing tensions between China and the US in the field of technology and trade. Both countries are vying for dominance in the semiconductor industry, which is crucial for various technological advancements. The restrictions on rare metal exports by China could have significant implications for the global semiconductor supply chain and may further escalate the trade war between the US and China.
It remains to be seen how these export controls will impact the chipmaking industry and whether it will force countries like the US to find alternative sources for these critical raw materials. As the competition between China and the US intensifies, the semiconductor industry is likely to continue being a focal point in the ongoing economic and technological rivalry.