PLOT TWIST: The west's computer chip industry is being hit by Chinese export curbs, the Financial Times reported today. Key materials gallium and germanium are rising in price and shortages are looming.
This is the latest extraordinary turn in a saga which began with the US coercing the world's makers of high-end semiconductor manufacturing equipment to stop selling to Chinese firms or individuals.
Washington's October 2022 move was a hard blow to China, quickly hitting tens of thousands of Chinese industrial firms—but Beijing barely responded.
NO RESPONSE
For months the Chinese did nothing, and eventually made a tiny adjustment, lowering the amount of germanium and gallium that could be exported. These are two rare earths widely used in semiconductor manufacture.
That change has finally started to bite, a source told the Financial Times today, with prices of the substances doubling in Europe.
"If China reduces gallium exports as it did in the first half of the year, then our reserves will be consumed and there will be shortages," the unnamed source told the newspaper.
CIVILIAN DEVELOPMENT
The western press has repeatedly reported that the US ban on chip-making sales to China was aimed at harming that country's military—but a researcher at an MIT security conference showed this was untrue, with more than 99 per cent of China's high-end chip usage being for civilian use and general development, used in communications equipment, medical imaging technology, and so on
The west's mainstream press also continues to report that there is a tech-centered trade war between the US and China, but this is also misleading. Almost all the steps taken in the "battle" are actually attacks initiated by the west.
SIX SETS OF UNINTENDED CONSEQUENCES
There is growing evidence that US curbs on Chinese technology is having a major negative effect on the west, with unintended consequences in at least six areas.
First, the US attack destroyed the country's reputation, already much battered, as an honest broker. Washington came across as a dishonest bully that would break even the most fundamental rules of free trade to gain an advantage for itself, not caring about the effect on people associated with semiconductors in China, Japan, the Netherlands or elsewhere.
Countries worldwide realized that they had to "de-risk" from the US, not from China.
Second, the US move prompted Chinese chipmakers to work harder. One practical result is the Kirin 9000s, a super-chip jointly developed by Huawei and Tsinghua University.
Third, the US step prompted Chinese scientists to focus on future innovations, some of which have high potential. Tsinghua University has developed a particle accelerator producing a beam that can be used to make two-nanometer chips.
Fourth, the US attack unhappily forced private businesses around the world to stop making money selling equipment to China. The Reserve Bank of New York estimated the losses to the industry as US$130 billion, the Financial Times's Lex column reported today.
Fifth, the US move triggered the growth of business sectors in which the world's tech firms found alternative ways of selling equipment to China. Nvidia and ASML, for example, have found ways to regain Chinese firms as major customers.
Sixth, and probably worst, from the US point of view, is that it changed the global playing field irreparably. Today, many if not most countries are reviewing their trade relationships with the US, studying de-dollarization, considering BRICS membership, and examining options to join the Belt and Road Initiative, the biggest global trade project in human history.
In terms of worst ever "own goals", the US attempt to strangle China's technological development is developing into a case for the history books.
[from Nury Vittachi, editor of fridayeveryday]
by Nury Vittachi
Lai See(利是)
** The blog article is the sole responsibility of the author and does not represent the position of our company. **
In a series of blistering statements,The Hong Kong Office for Safeguarding National Security (OSNS) has drawn a red line in the sand for anyone trying to weaponize the city’s recent misfortunes. The message is crystal clear and ominous: If you use disaster to sow chaos in Hong Kong, they will hunt you down—no matter where on Earth you try to hide.
On December 3, an OSNS spokesperson doubled down. While the HKSAR government and local citizens were racing to save lives following the tragedy at Wang Fuk Court in Tai Po, a shadow game was already in play. The office accuses a "small group of external hostile forces" of looting a burning house. Under the guise of petitioning for the people, these actors are dusting off the old playbooks from the "extradition bill protests". They are activating agents, sabotaging relief efforts, and desperately trying to reignite the "Black Riots" memories. The verdict? Their actions are despicable enough to be universally condemned.
To drive the point home, the OSNS fired off three consecutive warning shots to overseas antagonists and anti-China disruptors:
First, we solemnly warn hostile foreign forces and anti-China disrupters that their actions of creating chaos and disorder in Hong Kong are intolerable.
Second, we solemnly warn hostile foreign forces and anti-China disrupters that their actions of adding fuel to the fire will inevitably bring disastrous consequences to themselves.
Third, we solemnly warn hostile foreign forces and anti-China disrupters that the long arm of the law will catch up with them.
The OSNS is keeping receipts. Every word and every action used to disrupt Hong Kong goes on the permanent record, and culprits will be pursued for life. "Anyone who breaks the law," the office warns, there is no sanctuary. Whether you are hiding across the ocean or taking refuge in Taiwan, severe legal punishment is inevitable.
Why is the OSNS speaking up now? Read between the lines, and you see three strategic pivots.
First, this isn’t hypothetical; they believe the foreign interference is already happening. Second, the crosshairs are locked on external forces, with a pointed finger specifically at those hiding in Taiwan. And third, it’s a preemptive strike against anyone overseas dreaming of stirring up another color revolution. The warning is blunt: Distance is not a defense.
Opportunists, Grifters, and Organized Lies
Take a look at the chatter exploding across the internet, and the opposing voices generally fall into distinct camps.
First, you have the fair critics. There is plenty of commentary that, while critical of the SAR government, remains objective. These observers stick to the facts disclosed by official investigations rather than drifting into malicious fantasy. This is a natural, human reaction to a "disaster of the century." And the smart money says the SAR government will take this advice to heart and improve.
Then come the fame vampires. When disaster struck, the opportunists came out of the woodwork. Look at "internet celebrity" Kenny, arrested on December 3 after cursing the Tai Po fire victims online for having "heavy sins." It was a blatant, tasteless grab for traffic, and it landed him in handcuffs for sedition. Then there are the exiled influencers abroad, wantonly bashing the SAR government while coincidentally begging people to subscribe to their Patreon accounts. The hustle is obvious: They are monetizing misery to please their financiers.
Finally, there is the organized sedition. Beyond the grifters, we are seeing waves of calculated propaganda. These aren't just complaints; they are fabrications designed to smear the SAR government and attack the Central system. Rumor mills are churning out wild stories linking material suppliers to the families of Central leaders—plots that are total fiction. It’s as if they believe overthrowing the Central government provides immunity from fire physics. Do massive fires not happen in Western democracies? The logic is broken, but in the heat of a disaster, it’s a potent recipe for inciting public rage.
Sniper Attacks From The Shadows
The temperature on these seditious campaigns was rising fast until the Police National Security Department stepped in. Once they acted, the local noise quieted down—but the overseas attacks only intensified. It raises a suspicious question: Is there a coordinated machine working behind the scenes to sustain sniper attacks against the SAR government? The narrative is set in stone: Whatever the government does is wrong. Before a single investigator has arrived on the scene, the instigators are already screaming for heads to roll.
Here is the bottom line. The OSNS isn’t pointing fingers at external forces for sport; they are firing warning shots because they see the smoke rising. We need to be sharper than ever. Don't let external opposing forces play you for a fool, twisting a tragic fire into a tool for subverting the local government—or even the Central government itself.
Lo Wing-hung
