The Chinese government has unveiled its plans to implement export controls on metals primarily used in semiconductor production for artificial intelligence (AI) systems. In a joint statement issued on July 3 by China's Ministry of Commerce and the General Administration of Customs, it was stated that These controls aimed to safeguard national security interests. Under the new regulations, the export of specific gallium and germanium products will require a government-issued license. The controls went into effect on August 1 and encompass eight gallium-related products, including gallium antimonide, gallium arsenide, and gallium nitride, as well as six germanium products such as germanium dioxide and germanium ingot.
Gallium is widely utilized in electronics, particularly in semiconductors, transistors, and lasers. It also finds applications in the production of LEDs. Germanium, on the other hand, plays a vital role in the manufacturing processes of semiconductors, solid-state electronics, and fiber optic systems. The joint statement warns of penalties for individuals or entities found exporting these products without the necessary licenses or in excessive quantities.
According to a 2023 report by the European Commission and the European Critical Raw Materials Alliance Association (CRMA), China remains highly concentrated as a global supplier of germanium, with over 80% of the world's gallium sourced from the country. The United States imposed sanction in October 2022, restricting Chinese developers' access to advanced semiconductors, including Nvidia's A100 and H100 chips. Chinese companies are now seeking alternative solutions to overcome the lack of access to high-performance chips, while US officials are contemplating additional export restrictions on advanced AI chips crucial for powering robust systems.
Nvidia, a major player in high-demand semiconductor development, has seen a surge in the value of its chips amid the AI boom. Cointelegraph reached out to Nvidia for comment on the recent developments in China, but the company declined to provide a statement at this time.
