According to trade experts, China has taken this decision in retaliation to USA’s strategies of export ban of key semiconductor technologies and equipment
Amid the ongoing geopolitical scuffle with the US, China has now undertaken some strict export control measures. As per media reports, China is curbing exports of two key materials germanium and gallium that are mostly utilized in manufacturing computer chipsets. China, which is known as the globe’s largest producer of metals, will unleash special licenses from the coming month to export these metals.
According to trade experts, China has taken this decision in retaliation to USA’s strategies of export ban of key semiconductor technologies and equipment. In fact, the US is also trying hard to persuade its allies such as the Netherlands, Japan, and India to stand against trade with China.
China announced this strategy just a couple of days prior to the visit of US Treasury secretary Janet Yellen to Beijing. In a media briefing, the Chinese Ministry of Commerce said that the licenses are required to protect the country’s national interests and security. Germanium and Gallium are mostly used in the making of defense and communications equipment, and semiconductors.
The US government on the other hand believes that if China gets access to the key semiconductor technologies then they can use it for their defense requirements, like chipsets utilized for artificial intelligence and supercomputing. In fact, Washington also did the same thing back in October 2022 when it announced that all the firms exporting chips to China requires special license no matter where they are manufactured in the globe.
After this announcement, allies such as Japan and the Netherlands also joined hands with the US. Following this strategy, the Netherlands announced to ban export of key microchip technology to China, which according to the experts will hurt the business growth of the country’s leading semiconductor firm ASML. Back in March this year, Japan also announced a restriction on the export of 23 types of semiconductor manufacturing equipment to China.
The USA’s actions in this regard has been termed by the Chinese government as ‘tech hegemony’ and in response to the same, Beijing has also carried out strict restrictions on a couple of US firms such as Lockheed Martin, the US defense and aerospace firm. According to a BBC report of BBC, secretary Janet said, “I think we gain and China gains from trade and investment that is as open as possible, and it would be disastrous for us to attempt to decouple from China."
