Isaac B. Kardon and Milo McBride
As the United States and China careen toward intensified economic decoupling and geopolitical rivalry, trends in the semiconductor and minerals sectors will define their strategic competition. Both great powers aim to consolidate competitive advantages by hampering the other’s technological development and hammering their trading partners. Both are doing so using increasingly damaging measures—but from opposite ends of tech supply chains. The American position remains strongest in advanced technologies, an edge that the Joe Biden administration sought to preserve and extend through an unprecedented series of export controls. China, meanwhile, is just beginning to implement a parallel export control regime that leverages its dominant market share in critical minerals as well as niche but strategic industries. The efficacy of both strategies will depend not only on each party’s execution, but also on their ability to sway middle countries toward cooperation.
Recent tit-for-tat actions mark a troubling new level of severity in this escalating struggle for technological advantage. On December 3, 2024, the People’s Republic of China (PRC) Ministry of Commerce (MOFCOM) imposed its first outright ban on the export of certain “dual-use” critical minerals to the United States. This export control went into force for germanium, gallium, superhard minerals like synthetic diamonds, and imposed additional licensing restrictions on graphite exports. In adopting this ambitious new measure, China was retaliating against U.S. semiconductor chip and manufacturing equipment export controls unveiled only the day prior. On February 4, 2025, in response to new U.S. tariffs on Chinese goods, MOFCOM announced restrictions on additional minerals including tungsten, tellurium, bismuth, indium, and products that include molybdenum. In initiating these outright bans, Beijing has aimed to mirror U.S. long-arm jurisdiction by, likewise, seeking to enforce its export controls extraterritorially in third countries, which could re-export the restricted goods to America.
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