China curbs critical metal exports in retaliation for Western restrictions on chip industry
- Beijing orders export controls on gallium, germanium and several of their compounds, which are used to make semiconductors and electronics
- The rules come just after the Netherlands announces new measures to limit China’s access to advanced chip manufacturing equipment
The restrictions, which take effect on August 1, will apply to gallium and germanium metals and several of their compounds, which are key materials for making semiconductors and other electronics.
The Ministry of Commerce said in a statement that the export controls on gallium- and germanium-related items were necessary “to safeguard national security and interests”.
Exporters in China will need to apply for permission from the ministry, with information about the end users and how the materials will be used.
China hits out at US ‘coercion’ after Dutch move to curb chip gear exports
It added that operators caught in violation of the controls could face administrative punishment or even criminal charges.
The decision came after the Netherlands announced new export controls on advanced chip manufacturing equipment last Friday, following Washington’s lead to curb China’s chip-making capabilities.
Companies in the Netherlands including ASML – one of the world’s most important producers of semiconductor machinery – will need to apply for a licence to export certain advanced semiconductor manufacturing equipment overseas.
The Dutch restriction will come into effect on September 1.
China said it was “an abuse of export control measures and seriously disrupted free trade and international trade rules”.
In addition, Japan’s export restrictions on 23 types of chip-related equipment and materials will also enter effect later this month.
China is the world’s largest producer of the two elements, with more than 95 per cent of the global gallium output and 67 per cent of germanium production.
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Concerns have grown that China could “weaponise” its dominance in these critical elements amid competition between Beijing and Washington, which has escalated since the US launched its trade war in 2018.
China introduced an export control law in 2020 and eventually added more items into its list, including some rare earth-related items.
The items included in Monday’s control lists include gallium nitride, gallium oxide, gallium phosphide, gallium arsenide, indium gallium arsenide, gallium selenide, gallium antimonide, zone-refined germanium ingot, zinc-germanium diphosphide, germanium epitaxial growth base, germanium dioxide and germanium tetrachloride.
