China has said it will impose export controls next month on items related to two rare earth metals used for chip production to "safeguard national security," in apparent retaliation for U.S. semiconductor export restrictions imposed on China.
China's Commerce Ministry said Monday that the export of items related to gallium and germanium will require its approval from Aug. 1. The new measures are based on a law that took effect in December 2020, prohibiting the export of state-of-the-art technologies and products that could be diverted to military use from the country.
The new restrictions will likely affect semiconductor producers, including those based in Japan, as a large share of the two rare metals available on the global market are Chinese-owned.
Chinese Foreign Ministry spokeswoman Mao Ning said at a press conference Tuesday the new measures are "not targeted at any particular country." She said Beijing enforces "justified and non-discriminatory" export control measures and is committed to protecting the security and stability of international supply chains.
Japan will examine the potential effects of the Chinese restrictions, its trade minister said.
"We'll respond appropriately in line with international rules laid out by institutions including the World Trade Organization if the measures are unjust," Economy, Trade and Industry Minister Yasutoshi Nishimura told a press conference in Tokyo.
Renesas Electronics Corp. said in a statement that it will "monitor the effects of the restrictions." The Japanese chip producer is working with electric motor maker Nidec Corp. to develop next-generation power semiconductors for electric vehicles.
Technology conglomerate Toshiba Corp. also plans to mass-produce power semiconductors in fiscal 2024.
A source connected to a chipmaker said developments concerning regulations on semiconductor materials depend on political conditions. "We hope (the restrictions) won't affect our business."
The U.S. administration of President Joe Biden announced last October sweeping export curbs on certain advanced computing chips and related items in an effort to hobble Beijing's efforts to develop advanced technologies for military purposes.
The Biden administration has also asked Japan and the Netherlands, two countries where leading high-tech chip-production equipment makers are located, to cooperate to limit China's access to cutting-edge semiconductor technology.
In January, Japan and the Netherlands agreed to join the United States in curtailing exports of advanced technologies that China could use to develop artificial intelligence and modernize its military capabilities.
Following the three-way agreement, Japan unveiled its new export control measures in March, which are set to take effect on July 23.
Nishimura emphasized that the measures were not devised to target any specific country, although the move comes in response to heightened economic security risks, including China's growing influence.
The steps will be implemented "in accordance with international rules," the minister said.
The Netherlands said last week it will tighten restrictions on semiconductor equipment exports from September.
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