US says it opposes export controls by China on metals, will consult allies

By Kanishka Singh

WASHINGTON (Reuters) – The United States “firmly” opposes export controls announced by China on gallium and germanium, metals needed to produce semiconductors and other electronics, a U.S. Commerce Department spokesperson said on Wednesday, adding that Washington will consult its partners and allies to address the issue.

Earlier this week, China put export controls on gallium and germanium products, used in electric vehicles (EVs) and fiber optic cables. The abrupt announcement of controls from Aug. 1 has sent companies scrambling to secure supplies and bumped up prices.

Germanium is used in high-speed computer chips, plastics and in military applications such as night-vision devices, as well as satellite imagery sensors. Gallium is used in radar and radio communication devices, satellites and LEDs.

“These actions underscore the need to diversify supply chains. The United States will engage with our allies and partners to address this and to build resilience in critical supply chains,” the Commerce Department spokesperson said in an emailed statement.

China’s move, which its commerce ministry said was to protect national security, was seen by economic analysts as a response to escalating efforts by Washington to curb China’s technological advances.

The announcement came on the eve of the U.S. Independence Day holiday and just before U.S. Secretary of Treasury Janet Yellen visits Beijing.

The European Commission has also expressed concern, while Germany’s Economy Minister Robert Habeck said any broadening of controls to materials like lithium would be “problematic.”

The issue marks the latest chapter of U.S.-China tensions that have been escalating in recent years over issues like trade tariffs, the origins of the COVID-19 pandemic, cyber security, spying allegations, and technological competition.

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