by Laura He at CNN Business
A trade war between China and the United States over the future of semiconductors is escalating.
Beijing hit back Monday by playing a trump card: It imposed export controls on two strategic raw materials, gallium and germanium, that are critical to the global chipmaking industry.
“We see this as China’s second, and much bigger, counter measure to the tech war, and likely a response to the potential US tightening of [its] AI chip ban,” said Jefferies analysts. Sanctioning one of America’s biggest memory chipmakers, Micron Technology (MU), in May was the first, they said.
Here’s what you need to know about gallium and germanium, how they could play into the chip war and whether more countermeasures could be coming.
How did we get here?
Last October, the Biden administration unveiled a set of export controls banning Chinese companies from buying advanced chips and chip-making equipment without a license.
Chips are vital for everything from smartphones and self-driving cars to advanced computing and weapons manufacturing. US officials have talked about the move as a measure to protect national security interests.
But it didn’t stop there…
Continue Reading