June 21, 2024

News Collective

Complete New Zealand News World

Chip War and Reciprocity » Enrique Dance

Chip War and Reciprocity » Enrique Dance

the China’s response To Western restrictions on the chip manufacturing industry was the ban Export Gallium And GermaniumThey are two essential components of the same industry, which manufacturing companies will now have to try to acquire in other countries.

Gallium and germanium are generally obtained from zinc and aluminum mining, where they are extracted as byproducts. China produces between 80% and 95% of the total extracted gallium and about 60% of germanium, which could significantly complicate supply chains and lead to new crises in the supply of semiconductors. Although it is possible to supply these components through other countries, withdrawal from the Chinese market generates significant tensions and very complex effects: At this time, the price of gallium and germanium has fallen significantly on the Chinese market with their price rising. Due to the cessation of exports, they increased in the rest of the world.

China’s restrictions are a product of reciprocity: companies like SMIC have been considered as potential suppliers of chips to the military industry. The United States imposed restrictions early in 2020And he asked Trading partners such as Germany also Holland To do the same using, for example, the chemicals necessary for these processes, especially in the case of those that allow them to be carried out Producing advanced chips such as those with three nanometer dimensions.

Providing this type of item is very complex. Relatively small quantities, up to hundreds of tons, are produced worldwide, and in some cases recycling is used extensively: more than a third of the germanium used in industry comes from this type of process.

See also  Announcing Microsoft Azure Data Manager for Agriculture: Accelerating Innovation Across the Entire Agricultural Value Chain

The restrictions, in addition to chip manufacturing, are likely to affect components used in the electric vehicle and solar panel industries. China is also studying the possibility Banning the export of other metals such as neodymiumIt is used to produce strong magnets that are also used in many manufacturing processes.

We are facing an increasingly complex scenario: supply chain difficulties imposed by the trade war mean that massively strategic industries suffer from supply problems and could, ultimately, slow down the production of some of the core decarbonisation technologies, undoubtedly the most important. An important technological transition in human history on which the possibility of slowing the climate emergency depends. In this sense, China has placed itself in an absolutely strategic position with respect to components such as solar panels and batteries, and is able to implement much greater reductions in its emissions than other countries despite starting from a more worrying situation.

When we talk about issues of such importance, it is essential to understand that we must act at the global level and use the resources of all countries to respond to a crisis that affects us all. Endangering the development towards an increasingly carbon-neutral economy due to considerations of commercial interests or concerns about global technological leadership is, by all accounts, completely irresponsible. Trade wars never have winners, they only create many losers. We’ll see if this doesn’t end up making us all losers.