In August, the Chinese shut down the export of two important rare earth metals used in semiconductor manufacture: gallium and germanium.
In July, I reported that the US was considering new chip restrictions on exports to China related to the rapid development of artificial intelligence (AI) capabilities.
It looks like those restrictions are about to be implemented.
The Biden administration warned Beijing of its plans to update rules that curb shipments of AI chips and chipmaking tools to China as soon as early October, a U.S. official said, a policy decision aimed at stabilizing relations between the superpowers.
The Commerce Department, which oversees export controls, is working on an update of export restrictions first released last year. The update seeks to limit access to more chipmaking tools in line with new Dutch and Japanese rules, other sources said, and to close some loopholes in export restrictions on artificial intelligence (AI) chips.
“The PRC has been expecting an update around the one year anniversary, based on conversations with administration officials,” the U.S. official said, using the abbreviation for People’s Republic of China. The original rules were published Oct. 7, 2022.
Supposedly, the move will help soothe trade tensions between the US and China.
Providing China with a heads up about the rules is part of a broader bid by the Biden administration to stabilize relations with Beijing. The outreach comes after a decision by the U.S. to shoot down a Chinese spy balloon sharply escalated tensions in February.
The Biden administration has also sent a series of high-level officials to China, including Commerce Secretary Gina Raimondo in August. Additionally, National Security Advisor Jake Sullivan held talks with Chinese Foreign Minister Wang Yi in September.
The restrictions released last October sought to prevent U.S. technology from being used to strengthen the Chinese military by cutting off its access to advanced AI chips and curbing its ability to import the most sophisticated chipmaking tools from the United States.
The Department of Commerce declined comment, while a spokesperson for the Chinese embassy in Washington had “nothing to offer,” when asked for comment on the warning.
However, that horse may have left the barn already. In August, the Chinese shut down the export of 2 important rare earth metals used in semiconductor manufacture: gallium and germanium.
China did not export any germanium and gallium products in August, after export curbs kicked into effect at the start of that month for these two chipmaking metals.
Customs data on Wednesday showed that China exported zero germanium product last month, down from 8.63 metric tons in July, Reuters reported.
July germanium exports were more than double that of June’s, as purchases spiked ahead of the effective date for the curbs that are part of China’s escalating war with the U.S. and its allies over access to strategic technology.
There were also no exports of gallium products in August, compared to the 5.15 tons exported in July, customs data showed.
Here’s hoping Vietnam breaks China’s near monopoly on this vital resource.
Vietnam plans to restart its biggest rare-earths mine next year with a Western-backed project that could rival the world’s largest, according to two companies involved, as part of a broader push to dent China’s dominance in a sector that helps power advanced technologies.
The move would be a step toward the Southeast Asian country’s aim of building up a rare-earths supply chain, including developing its capacity to refine ores into metals used in magnets for electric vehicles, smartphones and wind turbines.
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