The Chinese Communist Party (CCP)’s decision to restrict the West’s access to the crucial metals gallium and germanium demonstrates the party’s willingness to use its dominant control over mineral resources to disrupt Western supply chains, reports The Wall Street Journal.
The CCP fired “the warning shot” just days before the U.S. Treasury Secretary Janet Yellen headed to China to discuss economic and trade relations. The measure “will have an immediate ripple effect on the semiconductor industry, especially with regards to high-performance chips,” argues Alastair Neill, board member of the Critical Mineral Institute.
China, furthermore, refines most of the world’s lithium, aluminum, cobalt, manganese, graphite, and nickel – all of which are crucial in the manufacturing of electric vehicle (EV) batteries. If China were to restrict access to them, the entire production of EVs across the world would be thrown into “disarray” and could even disrupt American defense industries.
“We would be foolish to limit our thinking that that kind of thing is impossible,” states Morgan Bazilian, director of the Payne Institute for Public Policy.
The Biden government has made some effort to reduce the United States’ reliance on Chinese minerals, despite the country having “little processing capacity” itself. Several American companies are seeking permits to open nickel mines in Minnesota and EV factories in North Dakota. However, mines and EV factories take years to develop.
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