China has begun restrictions on exports of products and materials that include the metals gallium and germanium, both major components of semiconductors, 5G base stations and solar panels.
The restriction is seen as a response to restrictions imposed by the United States and other countries on the sale of chips and high-end chip-making equipment to China — primarily from Nvidia.
The US claims its actions against Chinese chipmakers are designed to prevent China from developing technologies that could give it an advantage in defense or other sectors deemed critical to national security.
Beijing has argued that these measures are intended to curb China’s economic growth.
From August 1, according to a Chinese Ministry of Commerce announcement, gallium and germanium exporters will need to apply for licenses and report details of their overseas buyers in a bid to “protect national security and interests.” Although China is a dominant player in the global production, refining and processing of many important raw materials, including gallium and germanium, it still relies on Western technology to produce high-performance chips.
Gallium, which is primarily sourced from China, is an important component in a growing class of semiconductors used in a wide range of commercial and military applications. Germanium, another important metal, is commonly found in solar cells and fiber optic systems.
The economic wars have escalated a bit.