Inside China Business US price tag for China’s gallium export ban: $602 billion and new monopolies for Huawei
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In retaliation over semiconductor export bans, China banned exports of gallium. A mere 30% reduction in gallium supplies to global markets would result in a $602 billion hit to the US economy alone, according to experts.
What’s more, gallium is a critical component in 5G telecom gear, a market where Huawei already has large advantages and is believed to be at least a generation ahead of competitors outside China. Gallium nitride allows for telecom gear to be made much lighter, resulting in far lower costs for installation, maintenance, and repair, and allows for lighter masts and poles. For Huawei’s rivals in the 5G space, such as Nokia and Ericsson, a gallium ban would put them even farther behind Huawei.
China controls over 95% of the global market for gallium, and the White House’s own official analyses of China’s gallium monopoly concluded that an export ban would result in crippling effects to a wide variety of US industries, including defense.
Resources and links:
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