Chinese Legislation Targets U.S. Trade Sanctions

China is currently the largest producer of gallium and germanium, accounting for 94% and 83% of global production, respectively. They have a wide range of applications in optoelectronic displays, communications, lasers, detectors, sensors, solar energy and radar.

Shu Jueting, a spokesperson for the Ministry of Commerce, said that items related to the two metals have prominent dual-use properties for military and civilian purposes. She said it is an international practice to implement export controls on them. The regulations will come into force on August 1.

Exporters who want to start or continue exporting items related to the two metals must apply for a license from China’s Ministry of Commerce and report details of overseas buyers and their applications.

Hu Xijin, the influential former editor-in-chief of the Global Times, said on China’s Twitter-like Weibo platform, “China’s anti-sanctions, anti-interference, and anti-long-arm jurisdiction by certain countries require this law, and it will definitely increase the price for the United States and its allies to violate China’s interests.”

The Global Times says with the law, China is “marking a milestone significance, as it is the first fundamental and comprehensive foreign-relations law that aims to fix the loopholes in the rule of law in foreign-related affairs amid new challenges in foreign relations, especially when China has been facing frequent external interference in its internal affairs under the Western hegemony with unilateral sanctions and long-arm jurisdiction.”

Zhao told VOA Mandarin the new law “is mainly aimed at the domestic people. … Americans will not buy it. Xi Jinping’s international development initiative, international security Initiatives and the Belt and Road Initiative have been talked about a lot, and there is nothing new for the United States.”

The Chinese government has long complained that the U.S. uses economic sanctions for diplomacy and says it passed the Anti-Foreign Sanctions Law in 2021 to counter foreign sanctions against Chinese companies and individuals. However, China also frequently uses economic sanctions to exert political pressure on such countries as Australia, Canada, South Korea and Lithuania.

The current chip war between China and the U.S. is an example of how both nations employ sanctions.

In October 2022, the U.S. Department of Commerce announced export controls on advanced semiconductor and chip manufacturing equipment to China.

In May, the Chinese government announced a ban on the U.S. chip giant Micron, saying it caused a significant security risk to China’s critical information infrastructure supply chain.

It followed Beijing’s announcement in February of sanctions against two U.S. arms makers — Lockheed Martin and Raytheon Technologies — for supplying arms to Taiwan, including banning Chinese companies from doing business with them.

Recently, the Biden administration is reported to be preparing to restrict Chinese companies from using U.S. cloud computing services. If adopted, the new regulation could require U.S. cloud service providers, such as Amazon and Microsoft, to obtain a U.S. government license before providing cloud computing services that use advanced artificial intelligence chips to Chinese customers.

“This is sending a clear signal right before Yellen’s visit” to China, Tangen said. “The U.S. is … going to keep Chinese companies out of the cloud.”

He said the rift is causing a “split between the countries in terms of technology.”

“Right now, I don’t think Beijing is counting on changing the minds of Washington elites,” Tangen said. “What they’re betting on now is that the business community, which has an interest in China, is not having a world decoupled. It will cost all American businesses a tremendous amount of money to relocate to other countries or within the U.S. to do the same thing.”

Zhao believes the law does not make much of a difference.

“When it first came out, people couldn’t figure it out,” he said. “But the heat passed within a day or two … and now there are not many people discussing it.”

Bo Gu is a reporter at VOA News. Adrianna Zhang contributed to this report. This article is published courtesy of the Voice of America (VOA).