Beijing is restricting the export of niche metals used in semiconductors, citing national security grounds. Chinese firms looking to sell certain gallium and germanium products abroad will need a special licence from 1 August.
Been a while since you took chemistry?
- 📟 Gallium is a soft, silvery metal used in advanced circuitry, and
- 🔭 Germanium is a brittle, grey metal used in advanced optics
They’re the ‘special sauce’ in everything from semiconductors, LEDs, and niche comms gear, through to weapons-sighting and night-vision systems.
And China produces 98% of the world’s gallium and 80% of the germanium. So its new export curbs will be felt just about everywhere.
Why’d China do this?
- The official statement (in Mandarin) says it was to “safeguard national security and interests”, and
- State media then said the quiet bit out loud, linking the new measures to the West “relentlessly stepping up crackdowns on China’s technological development”.
Intrigue’s take: When the world’s two largest economies get into a trade war, collateral damage is inevitable. That explains some of the early reactions:
- 🇰🇷 South Korea has called an emergency meeting on the new rules
- 🇯🇵 Japan says it’s scrutinising China’s rules for WTO violations, and
- 🇪🇺 The EU was quick to express… “concern” (🔥🔥🔥🔥)
But the move will impact China, too: it risks vindicating concerns about China’s coercive economic policies, and accelerating the West’s “de-risking”.
For now, the new process is technically just a licensing requirement; a lot will depend on what China does with it. And that probably gives China leverage.
Also worth noting:
- Gallium and germanium are also used in solar panels and EVs.
- The Netherlands just expanded (on Friday) its own restrictions on the export of advanced machinery that produces semiconductors.
- Washington is reportedly looking to limit China’s access to cloud services provided by US companies such as Amazon and Microsoft.
