China is imposing controls on exports of gallium and germanium, which are used to make semiconductors and electronics, in the latest development in the global battle to control chipmaking technology
China dominates supply of high-tech metals
The restrictions, which will take effect from 1 August, will apply to gallium and germanium metals and several of their compounds. Exporters will need to apply for licenses from the commerce ministry if they want to begin or continue to ship gallium and germanium out of the country. They will be required to report details of the overseas buyers and their applications. China said the new licensing system was aimed at protecting national security.
China holds the dominant position when it comes to high-tech metals, like gallium and germanium. The two metals are key in chipmaking, communications, electric vehicles and industries. The metals also have applications in the military industry – in radars, high-power lasers and spy satellites.
The Chinese measures come days after the Netherlands announced plans to apply the latest set of controls to limit the sale of high-end chipmaking equipment abroad. The move will effectively bar ASML, the Dutch company producing the world’s most advanced semiconductor-making tools, from reaching Chinese companies.
Japan and the US have also taken steps to limit Chinese companies' access to chips and chipmaking equipment.
China is the world-leading producer of gallium and germanium so any restrictions on exports to the rest of the world will likely increase prices for manufacturers or slow down production. Both metals are on the European Union’s list of critical raw materials, deemed “crucial to Europe’s economy”.
China accounted for about 98% of the world’s gallium production in 2022, estimated at 430,000kg in 2021. China was also the world’s leading producer of germanium in 2022, with the country controlling 68% of global refinery production, estimated at 140,000kg in 2021, according to the US Geological Survey (USGS), with the rest of processing spread across Europe and North America.
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