Free trade please
Effective 1 August, exporters of gallium and germanium in China will need a licence to ship these two precious metals used in the manufacture of semiconductors. Considering that China produces 60% of the world’s germanium, according to Europe’s Critical Raw Materials Alliance, and 80% of all gallium, Beijing’s move could hamper chip-making outside China.
Though it has sought to justify it on national security, it’s lost on nobody that this is retaliation for curbs placed on technology-sensitive exports to China by its geopolitical opponents, led by the US. How hard Beijing will clamp down on these exports is unclear.
It may be a bargaining chip for trade deals as others scramble to secure key inputs for technological advances. But whatever the actual game being played by Chinese strategists, it should not amount to an export embargo, which would get in the way of global progress.
In 2010, China restricted exports of rare earth materials to Japan. Since then, apprehensions have only grown of Beijing trying to monopolize their use.
These tactics need to be resisted. But equally, global powers like the US must do their bit to get globalization and free trade back in favour across the globe.
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