Beijing tightens its grip on advanced Chinese technology, aimed at keeping critical knowledge within its borders while trade tensions with the United States and Europe degenerate.
Chinese authorities in recent months have made more difficult for some engineers and equipment to leave the country, offered new export controls to keep key battery technologies and moved to restrict the treatment technologies for critical minerals, according to Several figures from industry and ministry advice.
The country’s safeguarding of the main technologies is safe in the middle of the US President Donald Trump’s additional rates and a commercial row with Europe on cars, which threaten to stimulate more local and foreign groups to move production elsewhere.
Among the companies to strike is the main manufacturing partner of Apple, Foxconn, which led the diversification of the Silicon Valley Group supply chain In India.
People familiar with the case said that Chinese officials had made it difficult for the Taiwanese contractual manufacturer to send technical Chinese machines and managers to India, where Apple wishes to build its supply chain.
A manager of another Taiwanese electronics company said they were also faced with challenges by sending China equipment to factories in India, although he noted that shipments in Southeast Asia are remained normal.
An Indian official allegedly alleged that China used customs delays to hinder the flow of components and equipment heading south. “The players in the supply of the electronic industry have been invited not to establish manufacturing and assembly operations in India,” said the manager, asking not to be appointed. The REST OF WORLD media site reported earlier on some of Foxconn’s problems.
Analysts say that the emerging Beijing game book resembles Western technology transfer restrictions which he criticized aloud as unjust. Informal controls seem in particular to target the geopolitical rival of India in China, certain Chinese groups claiming that projects in Southeast Asia and the Middle East are not affected. But Beijing is also increasingly deploying formal export restrictions on key technologies that apply worldwide.
“A strong supply chain and a skilled workforce are some of the rare advantages that China still has today,” said an investor in a company faced with problems to move certain technical engineers to the ‘stranger. “You don’t want to lose this to other countries.”
The Chinese Ministry of Commerce last month proposed restrictions on the export of technologies linked to the extraction of lithium and the manufacture of advanced battery materials, the two areas where the country has a leading position.
“China constitutes a large export control muscle and is quite deliberate in what they choose to control,” said Antonia Hmaidi, principal analyst of the Mercator for China Studies Institute. “It is fundamentally to keep China at the heart of world supply chains,” she said.
Hmaidi said Beijing often targeted areas near the top of the supply chain where Chinese groups controlled materials and technological processes, while leaving uncontrolled final products.
Cory Combs by Consultancy Trivium China said that the interventions that Beijing had presented in the battery supply chain represented “a new class of export controls”.
If it is adopted in full, orders could prevent giants from China battery with factories in Europe from moving their entire supply chain abroad. Groups such as CATL may need to continue to import battery materials such as advanced Cathodes of lithium iron phosphate (LFP) of China instead of being able to produce or buy them locally, according to a person informed of the issue.
Chinese breakthroughs in LFP technology supported the rise of its battery giants, moving the South Korean and Japanese groups, which once dominated the battery industry.
Tending to catch up, Korean groups had started to associate and buy LFP cathodes in China, which produced last year 99% of all active materials of the LFP cathode, according to Benchmark Mineral Intelligence.
New controls could threaten these agreements. A spokesperson for a leading Korean battery producer, who asked that their business is not appointed, said they have communicated their concerns to the Chinese trade ministry.
“We cannot exclude certain negative effects on our partnership with a Chinese company if the directives do not reflect our concerns,” said the person.
Sam Adham, manager of battery research at the raw analysis company Group, said: “Koreans need high -end Chinese technology, but [with the new export controls] They can only access the technologies of last year – namely what is on the roads at the moment. »»
The borders described on exporting lithium extraction technology could complicate the ongoing developments from the United States to South America. A person close to CATL said the group should request export licenses to use Chinese technology in a $ 1.4 billion project in Bolivia to extract lithium from the country’s salt apartments.
Anna Ashton, founder of the China Consulting Consulting Society, Ashton Analytics, said Chinese groups had been the pioneers of technology to extract and treat brightly underground -rich brothers, which makes many new mining projects.
“Ironically, the contraction with Chinese companies is currently the most effective way to bring non-Chinaise sources of lithium extracted and transformed into line,” she said.
In strategic materials and minerals, Beijing has gradually expanded its edges to include both the export control of the key elements – such as rare earths, tungsten and tellurium, among others – to also restrict the technologies used for their extraction, refining or treatment.
In December 2023, China further extended orders to technology and processes that transform rare earth refined into permanent metals and magnets used in electric vehicles, wind turbines and electronics.
“China manufactures something like 95% of permanent magnets in the world,” said an employee of an American group who accumulates an alternative supply chain.
“The net effect of these export controls is that industrial diversification in some of these supply chains is reduced.”
The Chinese trade ministry has not responded to a request for comments. Foxconn and Catl refused to comment.
Additional Gloria Li reporting in Hong Kong, Song Jung-A in Seoul, Nian Liu in Beijing
