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China’s Export Restrictions on Key Materials: A Potential Financial Blow to the U.S. Economy

 

 

Impact of China’s Ban on Gallium, Germanium, and Others: Potential Billions in Losses for the U.S.


On Tuesday, China prohibited the export of vital minerals such as gallium, germanium, and antimony to the United States. These elements are crucial for several technology and defense sectors.

 

This ban is a reaction from China to the recent expansion of U.S. regulations on technology shipments related to chips, as reported by Reuters.

According to an economic model from the U.S. Geological Survey released last month, the ban could result in a loss of about $3.4 billion for the U.S. economy.

Why are gallium, germanium, and antimony significant?

Gallium and germanium play critical roles in the manufacturing of semiconductors, as noted by mining.com. Additionally, germanium is integral to the production of various high-tech items, which include:

 

  • Optoelectronics, devices that handle light detection and control.
  • Solar panels.
  • Fiber optic cabling.

Antimony is utilized in military weaponry, according to the Center for Strategic and International Studies. Its applications encompass:

  • Armor-piercing projectiles.
  • Night vision devices.
  • Infrared detection instruments.
  • Bullets.
  • Precision optics.

 

What is China’s role in the production of these minerals?

In 2023, China was the top global producer of gallium, germanium, and antimony. The United States, on the other hand, did not produce gallium or antimony in that year. However, it did extract some zinc concentrates containing germanium from mines in Alaska and Tennessee.