US-China Tech and Mineral Trade War Intensifies: China Responds with Export Restrictions

Islamabad:The bilateral war between China and the United States in sectors such as technology, minerals, trade, and more has escalated, with both nations actively seeking alternative paths to reduce their dependence on each other in the fields of technology and minerals. The intensifying trade war has led to new measures including restrictions on minerals, investigations into US companies, and further technology trade restrictions.

**US Tech Restrictions on China**
After mounting pressure from the United States to impose technology sanctions on China, Beijing recently initiated a series of countermeasures. These actions include cutting off supply lines and imposing sanctions on American companies operating within China. US President Donald Trump, during his tenure, repeatedly warned that he would impose tariffs on Chinese exports, and analysts predict that these technology sanctions on China will only get harsher once the new administration takes office.

**Chip Manufacturing: The Heart of the Tech War**
Experts suggest that the “chip war” between the two powers is heating up, with the US intensifying its efforts to limit China’s access to high-tech chips. On December 23, the US government announced it would begin “Section 301” investigations into China’s traditional semiconductor industry, assessing China’s goal of dominating the production of basic semiconductors and the impact this would have on the US economy.

In response, China’s Ministry of Commerce criticized these investigations as “unilateral and biased,” warning that they would disrupt the global chip industry and supply chains, ultimately harming US companies and consumers.

**US Strategy in Semiconductor Technology**
The US strategy in the semiconductor field against China can be divided into two aspects: first, limiting China’s access to high-end chip technology and equipment; and second, imposing export control measures to block China’s access to advanced chips and lithography tools necessary for production. Additionally, the US is investigating China’s subsidies for traditional chips to prevent cheap Chinese chip products from flooding international markets.

In the field of modern chips, the US Department of Commerce’s Bureau of Industry and Security (BIS) announced a new round of export control measures on December 2, aimed at further weakening China’s ability to develop modern semiconductors for advanced weapon systems, artificial intelligence (AI), and advanced computing technologies. Over 130 Chinese companies were added to the US Department of Commerce’s Entity List, and 20 types of semiconductor manufacturing equipment and software tools used to produce semiconductors were regulated.

**China’s Retaliation in Mineral Exports**
In response to the US and its allies’ sanctions, China has taken retaliatory actions, including imposing export controls on rare minerals critical for military and technological applications. According to reports from US agencies, China holds nearly 68% of the world’s gallium reserves and more than 90% of global gallium production, making it a dominant player in key minerals such as gallium, germanium, antimony, and graphite.

On December 25, a Chinese state-run English media outlet published an article stating that China is prepared to use its control over these critical minerals as a weapon against US sanctions. China’s Ministry of Commerce announced that it would ban the export of key minerals, including gallium, germanium, antimony, and superhard materials, to the US—a move that is seen as a strategic countermeasure to combat US technological sanctions.

**Global Supply Chain Impact**
Although China is the dominant global supplier of several key minerals, including gallium, germanium, and graphite, it is not the sole supplier. According to the US Census Bureau, the US imported more unprocessed gallium from Canada than from China last year, and Germany remains the top supplier of processed germanium. However, China’s growing influence over these essential minerals is expected to play a significant role in the ongoing trade tensions.

As the US and China continue to navigate this escalating trade and technology conflict, the global economy and supply chains could face significant disruptions in the coming years, especially in the critical areas of technology and raw materials.