Bangkok – China’s recent announcement of a ban on exports to the United States of key high-tech materials has caused a stir in the international trade community. The move, which includes gallium, germanium, antimony and other materials with potential military applications, is a direct response to the US’s restrictions on semiconductor-related exports.
The Chinese Commerce Ministry made the announcement on Tuesday, following the US’s expansion of its list of Chinese companies subject to export controls on computer chip-making equipment, software, and high-bandwidth memory chips. These chips are crucial for advanced applications and their restriction has sparked tensions between the two countries.
The timing of this decision is particularly sensitive as President-elect Donald Trump has been threatening to increase tariffs on imports from China and other countries. This has raised concerns about the potential escalation of trade and technology disputes between the two economic giants.
In response to the US’s actions, China’s Foreign Ministry issued a strong condemnation. “China has lodged stern protests with the US for its update of the semiconductor export control measures, sanctions against Chinese companies, and malicious suppression of China’s technological progress,” said Lin Jian, a Chinese Foreign Ministry spokesperson, in a routine briefing on Tuesday.
He further added, “I want to reiterate that China firmly opposes the US overstretching the concept of national security, abuse of export control measures, and illegal unilateral sanctions and long-arm jurisdiction against Chinese companies.”
The ban on exports of minerals such as gallium, germanium, and antimony, which are sourced in China and used in computer chips and other high-tech products, was first announced in July 2023. In August, the Chinese Commerce Ministry also imposed tighter controls on exports of graphite and restricted exports of antimony, which is used in a wide range of products from batteries to weapons.
These minerals are considered critical for national security, and China is a major producer of antimony, which is used in flame retardants, batteries, night-vision goggles, and even nuclear weapons production. The US International Trade Commission report in 2021 highlighted China’s dominance in the production of this mineral.
The latest restrictions announced by Beijing also include exports of super-hard materials such as diamonds and other synthetic materials that are used in various industrial applications like cutting tools, disc brakes, and protective coatings. These materials are not compressible and extremely dense, making them essential for many industries.
China’s actions are seen as a measure to protect its own interests from the US’s trade restrictions. After the US added 140 companies to its “entity list” subject to strict export controls, China’s Commerce Ministry protested and vowed to protect its “rights and interests.” While both governments claim that their export controls are necessary for national security, the trade tensions between the two countries have only intensified.
China has been frustrated with the US’s limitations on access to advanced processor chips and other technology, but it had been cautious in retaliating to avoid disrupting its own technological development. However, with the US’s latest actions, Chinese industry associations have issued statements condemning the US’s use of national security as a grounds for export controls.
The China Association of Automobile Manufacturers stated, “Such behavior seriously violates the laws of the market economy and the principle of fair competition, undermines the international economic and trade order, disrupts the stability of the global industrial chain, and ultimately harms the interests of all countries.”
Similarly, the China Semiconductor Industry Association expressed concerns about the disruption of supply chains and rising costs for American companies. It also warned that US chip products are no longer considered safe and reliable, and Chinese industries will have to be cautious in purchasing them.
The US heavily relies on China for its supply of gallium and germanium, with about half of its supply coming directly from China, according to the US Geological Survey. China exported 23 metric tons of gallium in 2022 and produces about 600 metric tons of germanium per year. While the US has its own deposits of these minerals, it has not been mining them, although some projects are exploring ways to tap into these resources.
The export restrictions have had a mixed impact on prices for these critical minerals, with the price of antimony more than doubling this year to over $25,000 per ton. Prices for gallium, germanium, and graphite have also seen an increase.
In conclusion, China’s ban on exports of key high-tech materials to the US is a direct response to the US’s restrictions on semiconductor-related exports. This move has caused tensions between the
