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China has announced an export ban on some critical rare earth minerals in retaliation to the Biden administration’s latest restrictions on semiconductor technology exports to China.
Let’s bring you up to speed: On Monday, the Biden Administration announced major export restrictions targeting China’s access to advanced semiconductor technology. The measures banned the export of specialized chipmaking equipment and high-bandwidth memory chips essential for AI data centers and blacklisted over 140 Chinese entities, including firms linked to Huawei, to limit their ability to acquire US technologies. These controls specifically target China’s capacity to manufacture cutting-edge chips, which are critical for advanced military systems, cyber operations, and surveillance technologies.
What China did in response: Following the United States move, China announced an export ban on critical rare earth minerals, including gallium, germanium, and graphite, citing national security concerns. Gallium and germanium are essential in producing semiconductors, electronics, and fiber optics, with gallium widely used in LED technology and germanium in infrared optics and solar cells. Graphite, a key material for electric vehicle batteries and nuclear reactors, was also subjected to tightened export restrictions.
In a statement, Chinese foreign ministry spokesman Lin Jian said, “China has lodged serious protests with the US for once again updating the export controls on semiconductors and sanctioning Chinese companies, and maliciously suppressing China’s technology progress. Let me reiterate that China firmly opposes the US’s overstretching the concept of national security, abusing export controls, and wantonly imposing illegal unilateral sanctions and ‘long-arm jurisdiction’ over Chinese companies.” He added, “We will do what is necessary to firmly safeguard our security and development interests.”
Digging deeper: China dominates the global supply chain for rare earth materials, producing approximately 60% of the world’s rare earth elements and controlling 85% of their processing capabilities. China’s dominance is particularly concerning for the United States as it heavily relies on Chinese supplies for critical materials like gallium and germanium, with China accounting for nearly 100% of the global gallium output and a significant majority of germanium production. Additionally, China provides the bulk of the world’s graphite, essential for electric vehicle batteries, with similar dependencies shaping industries across Europe and Asia.
