China's Retaliation in Chip War Escalates, Impacting Global Market

The Biden administration is considering new restrictions on exports of artificial-intelligence (AI) chips to China, which could further hinder China's ability to develop its AI capabilities. In response, China has retaliated by imposing export controls on gallium and germanium, metals used in semiconductor production. This move is seen as a countermeasure in the ongoing US-China tech fight. Analysts warn that if China escalates its threat, the market reaction could become more significant. The Department of Energy has identified gallium and germanium as critical materials, and China is a major producer of both.