China to curb chip exports

In response to national security concerns, China has announced restrictions on the export of rare metals essential for semiconductor production. According to guidelines issued jointly by the Ministry of Commerce and China Customs, Chinese exporters will require approval to send specific gallium and germanium products overseas, and these restrictions will be effective from August 1.

The move comes amid reports that the United States is also considering imposing new limitations on advanced chip exports to China. Gallium, recognised as a critical raw material by the European Union, plays a crucial role in the production of integrated circuits, LEDs, and photovoltaic panels for solar energy systems. On the other hand, germanium is used in manufacturing optical fibers and infrared camera lenses.

With China accounting for approximately 80 percent of global rare metals production, this decision could significantly impact the semiconductor industry worldwide, potentially leading to supply chain disruptions.

Over recent years, China and the US have been entangled in a heated geopolitical rivalry, resulting in reciprocal measures imposed on semiconductor and other vital technology sectors. The US has blacklisted numerous Chinese companies in an attempt to restrict their access to American chips and cutting-edge technologies, citing national security concerns.

Furthermore, the US has been urging its allies and partners to introduce measures aimed at limiting China’s influence in the tech industry. The Netherlands is among the countries planning to impose new export curbs targeting China later this year.

Beijing has accused the US of attempting to stifle Chinese innovation to maintain its dominance in the global tech sector. This ongoing tech rivalry between the two nations remains a contentious issue, impacting various industries and trade relations worldwide.