Earthquake in global trade: China bans the export of technology related to strategic metals

(Article published on Thursday, December 21, 2023 at 6:04 p.m. and updated on Friday, December 22, 2023 at 9:25 a.m.)The threat had been felt for several months. After packaging the export two strategic metals (gallium and germanium) with the approval of the central government of China announced on Thursday that it would halt the export of a number of rare earth technologies. A turning point in the history of world trade.

And for good reason, these metals are essential the development of numerous technologies (electrical batteries, chips, smartphones, LCD screens, the Internet, wind turbines and military equipment, etc.). As a reminder, rare earths are a set of 17 elements used in products cutting edge technology. So their extraction is essential.

It is clear that against the background of the growing rivalry with the United States, the Middle Kingdom will deprive its trading partners of several materials in order to control the issues of technological independence. With the first warning shot last July, this shutdown, China took a step forward. Determined to take the lead, the world’s second-largest economy overall now controls around three-quarters of the production of these rare earths.

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Specifically, it will now ban exports “technology of extraction, processing and smelting of rare earths”, according to a lengthy document released Thursday by the Commerce Department. However, the new regulations have no impact on the export of rare earth products themselves. On the other hand, it could frustrate development efforts in the sector outside of China.

A matter of national security

Contrary to what their name suggests, this set of 17 metals necessary for advanced technology is relatively abundant. But their particularly sought-after electromagnetic properties make them “strategic metals”.

In 2022, China mined 58% of global production and refined 89% of rare earths. According to the International Energy Agency (IAEA), the need for low-carbon technologies, especially for electric vehicle engines or offshore wind turbines, could multiply global demand sevenfold by 2040, or almost 2 million tons per year, compared to 280,000 tons in 2022. .

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Western countries, especially the United States of America, but also the European Union (EU), are increasingly considering the supply of these metals as a matter of national security, especially as the global energy transition raises concerns about potential shortages in the future.

In addition to permanent magnets in wind turbines and electric cars, some rare metals are used in the composition of television screens, drones and even hard drives. In response toThe EU could therefore consider “WTO action”. But” The WTO is an empty shell because the United States and China have been making decisions outside the institution for several years now,” he explained has Gallery Sylvain Bersinger from the Astérès design firm.

The United States wants to investigate the importation of Chinese chips by its companies

The United States announced on the same day that it wanted will begin investigating their companies to see how they source semiconductors made in China.

This survey” will inform U.S. policy to strengthen the semiconductor supply chain, promote a level playing field for traditional chip manufacturing, and reduce national security risks posed by China “, the Department of Commerce explained in a press release.

The stated objective: for the United States to maintain its lead,” several years » in China in semiconductor design.

National Security: The United States is investigating the importation of Chinese chips by its companies

Over the past few years, we have seen potential signs of China’s troubling practices aimed at increasing their companies’ semiconductor production and making it more difficult for US companies to compete. », Commerce Secretary Gina Raimondo also argued in a press release, referring to a report presented by a US parliamentary committee on December 12 that calls for ” reset » economic relations that the United States maintains with China.