Trade War Heats Up With China’s Export Restrictions on Two Critical Minerals – By J.D. Tuccile (Reason) / July 7, 2023
China and the U.S. are locked in a mutually destructive economic conflict.
Once upon a time, Joe Biden ran for the presidency on, in part, promises to end the Trump administration’s trade war with China. Instead, once in the White House, the Biden administration doubled down on its predecessor’s tariffs and picked new fights in an effort to isolate the Chinese economy. China’s political leadership contributes to this conflict, and its latest move is to restrict the export of two minerals critical to the production of computer chips.
Chokehold on Critical Minerals
“China will impose export restrictions on industrial products and materials containing gallium and germanium from August 1 to ensure its national security and interests,” China Daily, a mouthpiece for the Chinese Communist Party, announced this week. “According to the relevant provisions of China’s Export Control Law, Foreign Trade Law and Customs Law, gallium, which is used in the production of semiconductors and optoelectronic devices, and germanium, an important raw material for the semiconductor industry, as well as their related products, cannot be exported without permission after July. Export of other industrial materials such as gallium nitride, gallium oxide and zone-refined germanium ingot have also been prohibited.”
That’s a big deal because, according to the Observatory of Economic Complexity, “in 2021 the top exporters of Gallium, germanium, hafnium, indium, niobium (columbium), rhenium and vanadium: articles thereof, unwrought, including waste and scrap, powders were China ($170M), Chinese Taipei ($53.2M), Germany ($52.4M), Brazil ($43.1M), and South Korea ($32.4M).” China alone is responsible for 29.4 percent of the total (the U.S. is also an exporter, with a 5.47 percent share.)
