Germany is likely to put limits on export of chemicals to China that are used to manufacture semiconductors. The move is seen as part of the government’s efforts to reduce its economic exposure to the world’s second largest economy, Bloomberg news reported on Thursday.
The move is currently in the early stages of discussion in Berlin’s corridors of power.
What does it mean?
Such a move could damage Berlin’s ties with Beijing as Chancellor Olaf Scholz’s government continues to press for fairer market access while viewing China as a strategic rival.
If Germany pressed ahead with the curbs, it would be following partner countries of the European Union that have taken similar steps. These steps are seen to have been taken with a view to cut China off from certain supplies for micro-chip making.
The government in the Netherlands, home to semiconductor equipment makers ASM International and ASML Holding, last month laid out plans to further restrict exports of semiconductor technology to protect national security, joining the US effort to curb chip exports to China.
How such a move would come into being?
The quickest and most practical way to implement the export controls would be to put the respective goods and services on Germany’s national dual-use list, one of the people cited by Bloomberg said.
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Germany’s economy minister Robert Habeck had in March suggested that Berlin could impose export restrictions to China to prevent Germany from losing its technological edge.
(With inputs from agencies)
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