China has introduced trade restrictions on two of the EU’s most important strategic metals 

Restrictions on the export of gallium and germanium have been imposed by China, further intensifying trade tensions with Western allies.

On Monday, the Chinese Ministry of Commerce announced that to sell products containing the two materials, companies must first obtain an export license due to national security concerns.

So, what does the news mean in practice? The central government says that it will treat the metals as “dual use,” which means they can be used for both commercial and military purposes. Items that come under this definition are subject to extra controls, so if the government refuses to issue the license, the company will be banned from exporting it. 

Gallium and germanium are commonly used in various electronic devices like semiconductors, smartphones, pressure sensors, transistors, and fiber optics. These silvery-white metals are also crucial components in space systems, solar panels, and camera lenses.

When do the rules come into effect? 

The Chinese government says that the rules will come into effect from the 1st of August. The sudden announcement from Beijing has caused Brussels to be on high alert, as it has arrived at a time when there is a renewed effort to reduce the European Union’s reliance on commercial dependencies.

Under EU regulations introduced earlier this year, both gallium and germanium fall into the category of “strategic” rare-earth metals as they are essential to the green and digital transition, so companies are bound by targets when it comes to domestic extraction. 

However, China has a significant hold on the production of gallium and germanium, with control over 80% and 60% of the respective supplies. This puts the country in a dominant position within the global supply chain.

A European Commission spokesperson said: “Gallium and germanium are critical; they are essential for our industry, especially for their use in strategic sectors, and also (in the sense) that we are dependent on a single supplier,” 

“The Commission is concerned that these export restrictions are unrelated to the need to protect the global peace and also the stability and the implementation of China’s non-proliferation obligations arising from international treaties.”