China bans export of technologies related to rare earth mining and refining

China has implemented a ban on the export of technologies and carriers related to rare earth mining, refining, metal smelting, magnet manufacturing, and recycling. This policy includes export license requirements for all rare earth materials used in the production of advanced semiconductors, specifically those defined as 14nm and below.

According to Dean W. Ball, this move could significantly impact the global semiconductor supply chain, potentially hindering the growth of the U.S. artificial intelligence sector and leading to an economic crisis in the short term. The new regulations grant China de facto veto power over the advanced semiconductor supply chain, as rare earths are critical in various manufacturing processes, including those utilized by companies like ASML and TSMC.

Additionally, the export controls are extraterritorial, meaning foreign entities must obtain Chinese export licenses before re-exporting products that contain Chinese rare earth materials valued at 0.1% or more of the product"s total value. This mirrors the U.S. semiconductor export controls previously imposed on China, establishing a comprehensive control regime over rare earths.

For further context, recent developments in global economic policies highlight the interconnectedness of international trade regulations, as seen in the U.S. Treasury"s $20 billion currency swap agreement with Argentina.

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