China’s Rare Earth Metals Ban Hits US Chip Trade Restrictions Where It Hurts

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from Sputnik News:

Peter Arkell, chairman of the Global Mining Association of China who has been running a consulting business in the PRC for almost 20 years, said that Beijing’s restrictions on the export of rare earth metals were a predictable response to Washington’s trade war.

China’s curbs on rare earth metals to Western microchip makers comes as no surprise after a year of US-led sanctions, says a mining expert.

Beijing’s new restrictions on the export of eight gallium and six germanium products, on the basis that they have dual civilian and military uses, came into force on Tuesday.

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China is the world’s leading producer of those two elements, which are used in the manufacture of microchips. That followed a year of efforts by Washington to cut off China’s access to high-grade chips and the machines to manufacture them, under the pretext of US “national security.”

Global Mining Association of China Chairman Peter Arkell told Sputnik that the PRC’s response to the US embargo was no surprise.
“With roughly 90 percent of global production of these minor metals, gallium and germanium, China has hit the American CHIPS trade restrictions where it hurts,” he said. “It seems to be a pretty fundamental trade negotiation tactic.”
Exporters will now have to apply for special licenses, which could take up to two months to approve. Traders were unsure whether the government would limit the number of permits granted.
Since other nations reportedly only have enough stockpiles to last two or three months, Beijing’s measures could cripple semiconductor production in the rest of the world just when demand is on the rise as Western nations struggle to ramp up production of guided missiles and other arms.

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