U.S. Treasury Secretary Janet Yellen began a key diplomatic trip to Beijing on Thursday, just days after China unveiled new metal export restrictions and warned of stronger countermeasures—escalatory moves designed to showcase its geopolitical leverage and willingness to hit back at Western measures.
For months, the Biden administration has intensified efforts to strangle China’s tech sector, unleashing extensive export controls and measures that would restrict its access to the powerful semiconductor chips underpinning advanced technology and weapons systems. Beijing struck back this week with export restrictions aimed at the United States and Western markets more generally on gallium and germanium, two chipmaking inputs that are also crucial to missile systems and military technology. China accounts for some 94 percent of the world’s gallium and 83 percent of germanium and currently provides around half of U.S. supplies.
Gallium and germanium are “chess pieces in a geopolitical game of enormous proportions,” said Christopher Ecclestone, a mining strategist at the financial advisory firm Hallgarten & Company. “They’re pretty key playing pieces.”