China Announces Export Restrictions on Metals Amidst US Technological Companies
On Monday, China announced the introduction of restrictions on the export of metals, such as Gallium and Germany, for American technological companies. These metals are used for various purposes including the production of microcircuits, composite semiconductors, fiber-optic communication, nightlines, and radars. They are most commonly utilized in the military and space industries.
The statement was made on the eve of Independence Day and a few days before the visit of US Minister of Finance, Janet Yellen, to China. Analysts believe that this announcement serves as a clear signal to the Biden administration, which has imposed sanctions on the Chinese microchip sector. It is also known that the United States has pressured its allies, such as Japan and the Netherlands, to follow suit.
This move by China has caused widespread concern about potential restrictions on the export of rare-earth metals. If China were to impose such restrictions, it could leave the US without electric vehicles, smartphones, and other high-tech devices. China is the world’s largest producer of rare resources such as Samaria, Lantan, Terrib, and others. These resources have previously been subject to reduction in supply during a dispute with Japan 12 years ago.
Analysts have described these new export restrictions as China’s second, and currently largest, response in the ongoing technological battle with the United States. Earlier in May, China had already banned certain industries from purchasing products from American chip company, Micron.
Wei Jiango, a former trade and economics adviser in China, warned that authorities could introduce restrictions on the export of other strategic resources, including microcircuits. He emphasized that if the United States continues to apply pressure on Beijing, these current measures will only be “the beginning.”
During an interview with Reuters