Are Critical Minerals Trump Card In U.S.-China Chip Showdown?

Summary

• On Dec. 3, 2024, China's Ministry of Commerce implemented export bans on key semiconductor materials, including gallium and germanium, to the US.
• US-China tensions centered on semiconductors and critical minerals are apt to continue rising as each government deploys the levers at its disposal, including restrictions on the upstream supply of materials key to the chip sector.
• There is no provision in the CHIPS Act to incentivize the diversification of critical mineral supply chains for semiconductors, leaving the US - and most other Western countries - highly dependent on a handful of other nations for raw material supply.

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On Dec. 3, 2024, China's Ministry of Commerce implemented export bans on key semiconductor materials, including gallium and germanium, to the US. While these minerals had already been subject to existing export restrictions introduced in July 2023, this is the first time China has specifically