Source: The Times of India Published: 2024-12-3

By TOI

China on Tuesday imposed a ban on the export of critical minerals,including gallium, germanium, and antimony, to the United States in retaliation against Washington's crackdown on Beijing's semiconductor industry. The move, announced by China's ministry of commerce,is the latest in the intensifying trade tensions between the two superpowers ahead of Donald Trump's anticipated return to presidency.

Beijing's restrictions focus on materials vital to both technological and military applications.Effective immediately, China has prohibited the export of gallium, germanium, and antimony, along with superhard materials, categorising them as "dual-use items." The directive also subjects graphite shipments to the US to stricter scrutiny, particularly regarding end-use and final recipients.

China accounts for an overwhelming share of the global production of these materials. For instance, it provides 94% of the world's gallium and 83% of germanium, both crucial for semiconductors, fibreoptics, and solar technology. The ministry of commerce stated the restrictions aim to safeguardational security and meet non-proliferation commitments.

Retaliation against us semiconductor curbs

China's latest measure came a day after the United States announced sweeping export restrictions targeting 140 Chinese companies, including leading chipmakers like Naura Technology Group and Piotech.

The US measures extend to banning sales of hioh-bandwidth memory chios, essential for Al. And restricting access to chip-making tools produced in allied nations like Japan and the Netherlands. These controls mark Washington's third round of restrictions on China's tech sector in as many years.

The Chinese commerce ministry had critcised this move and accused the US of abusing "export control"and "engaging in unilateral bullying actions."

"The US preaches one thing while practicing another, excessively broadening the concept of national security, abusing export control measures, and engaging in unilateral bullying actions. China firmly opposes such actions," China's ministry of commerce had said in a statement released on Monday.

Strategic implications

Political analysts suggest that Beijing's actions are a calculated warning to the US regarding the vulnerabilities in its supply chains. Wang Yiwei, a trade expert, noted the restrictions would "bite" into the US defence and tech industries.

"The US often accuses China of diverting Western products and technologies for military purposes, but the US arms industry also uses raw materials sourced from China, even for weapons to be used by Ukraine," Wang told the South China Morning Post.

The implications of this tit-for-tat escalation are far-reaching. The restrictions on gallium and germanium could disrupt supply chains for semiconductors, while limits on graphite exports may hit battery production for electric vehicles and fuel cells.

Already, the effects of China's export curbs are evident. Shipments of antimony products, used in military and energy applications, dropped 97% in October following Beijing's earlier restrictions, are port by the SCMP said. Meanwhile, the US Geological Survey reported that China remains the dominant supplier of germanium and gallium despite curbs imposed last year.