China, key minerals such as gallium… U.S. export controls suspended for 1 year

Korea Economic Daily

Summary

China said it will suspend for one year export control measures to the U.S. on key minerals such as gallium, germanium, and antimony.
This was described as part of the easing of mutual retaliatory measures following the U.S.-China leaders' meeting, under a trade war truce.
The measure is expected to ease China's means of pressure on the U.S. semiconductor and battery industries.

China has decided to suspend for one year the export control measures on key minerals that it had been implementing targeting the United States. Following the agreement on a 'trade war truce' at the Busan U.S.-China summit, the two countries are gradually easing reciprocal retaliatory measures.

The Ministry of Commerce of China announced on the 9th that "the implementation of Article 2 of the 'Announcement on Strengthening Export Controls of Dual-Use Goods to the U.S.' announced in December last year will be suspended until November 27 next year." Accordingly, export restriction measures to the U.S. on strategic minerals such as gallium, germanium, and antimony, ultra-hard materials, and graphite-related items will be suspended for one year. Article 2 of the original announcement stipulated that "exports of gallium, germanium, and antimony to the U.S. are in principle prohibited, and graphite will be subject to strengthened end-user and end-use reviews."

Gallium and germanium are core materials used in advanced industries such as semiconductors, solar panels, lasers, and night vision devices; antimony is used in batteries and weapons; and graphite is the main raw material for anode materials in secondary batteries. China effectively controls the global supply chain of these minerals, and began a 'resource weaponization' strategy by restricting exports of gallium and germanium in August last year and graphite in December. With this measure, China's core material export restrictions are effectively suspended, and it is expected that a means of pressure on the U.S. semiconductor and battery industries will be eased. However, Article 1, which "prohibits exports of dual-use goods to U.S. military users or for military use," remains in force.

The U.S. and China exchanged high tariffs and various trade retaliation measures earlier this year, but on the occasion of the leaders' summit held in Busan on the 30th of last month, they agreed to a 'trade war truce.' After the summit, the two countries have shown an easing trend by consecutively suspending retaliatory measures such as additional tariff impositions.

Reporter Hye-in Lee hey@hankyung.com

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