The US opposes China's tightening of exports of two semiconductor-producing metals.

In an email sent to SCMP , a US State Department spokesperson said that China's actions underscore the need to diversify supply chains. Washington and its allies and partners will address this and build resilience in critical supply chains.

China's restrictions on gallium and germanium exports have drawn backlash from the US. (Photo: Reuters)

Tightening metal exports is Beijing's first major move in response to Washington's efforts to restrict China's use of American technology in the development of military and advanced computing applications.

On July 3, citing national security and interests, China's Ministry of Commerce announced export controls on germanium and gallium products effective August 1. Analysts believe this will further escalate the US-China trade war and undermine efforts to reduce dependence on China for essential materials.

According to Paul Triolo, senior vice president of the strategic consulting firm Albright Stonebridge Group, significant time and investment are needed to recreate even a fraction of the critical mineral supply chain.

Beijing had notified the US and EU in advance of its decision through export control dialogue channels. China is the world's largest producer of germanium and gallium, accounting for over 95% of gallium production and 67% of germanium production.

Mr. Triolo noted that Beijing views the new controls as a potential leverage point in negotiations with Washington regarding access to core technologies. On July 5th, former Chinese Commerce Minister Wei Jianguo commented that the export controls "are just the beginning of China's countermeasures."

According to the Wall Street Journal , the Biden administration is considering new regulations to ban Chinese businesses from using US cloud computing services such as Amazon and Microsoft. In October 2022, Washington banned the export of certain advanced semiconductor technologies to China. Last week, the Netherlands also announced export controls on high-end chip manufacturing.

US allies are assessing the impact of the new restrictions on their economies and seeking ways to respond. The EU is urging Chinese authorities to adopt an approach in which controls and restrictions are based on clear security considerations consistent with World Trade Organization rules.

(According to SCMP)

Gallium and germanium: What's the significance of China restricting exports of these two metals? China has just announced restrictions on the export of gallium and germanium, two metals crucial in the production of electronics and semiconductors.

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