China has announced a ban on the export of critical minerals, including gallium, germanium, and antimony, to the United States.
The move, revealed by the Chinese Ministry of Commerce on Tuesday, marks a significant escalation in the ongoing trade tensions between the world's two largest economies. These minerals are vital for the production of semiconductors, military equipment, and advanced technologies.
China Bans Key Mineral Exports to US in Retaliation Against Tech Restrictions
The decision follows a new round of US restrictions on Chinese companies in the semiconductor industry. Just a day earlier, the Biden administration imposed further curbs aimed at limiting China's access to cutting-edge technology, citing national security concerns.
According to CBS News, China's dominance in the production of these materials amplifies the impact of the ban. According to industry data, China produces nearly 99% of the global supply of gallium and over half of the world's antimony.
These materials are used in everything from fiber optics to electric vehicle batteries and military-grade ammunition.
Beijing justified the restrictions by pointing out the dual civilian and military applications of the minerals, stating that tighter controls are essential for national security. This response mirrors the US's recent measures aimed at curbing China's technological and military advancements.
The US government has criticized the export ban, with a White House spokesperson emphasizing the need to strengthen supply chains and reduce dependence on China. The situation highlights the vulnerabilities in the US supply chain, as it relies heavily on China for these strategic resources.
US Faces Supply Challenges as China Restricts Key Tech Minerals
Experts believe the ban could have far-reaching consequences. The restrictions may disrupt the global supply of these minerals, causing price hikes and forcing countries to seek alternative sources, NY Times said.
In 2010, a similar embargo on rare earth metals by China during a dispute with Japan led to widespread concern and efforts to diversify supply chains.
While the United States has some access to gallium and antimony through secondary suppliers like Japan and Germany, the ban underscores the urgency of developing domestic sources.
Projects to mine these minerals domestically, such as a proposed tungsten mine in Nevada, are underway but could take years to become operational.
The trade tensions are part of a broader pattern of escalating economic measures. Both nations have imposed tariffs and restrictions in recent years, further straining bilateral relations.
As the tech rivalry deepens, industry groups and analysts have called for de-escalation, warning of the economic risks to both nations and the global economy. For now, the latest measures signal that the trade war shows no signs of abating.
