South Korea has started to enhance monitoring of supply chains of key metals for chipmaking and high-tech industries in response to China's export controls and seek measures to minimize industrywide impacts, the industry ministry said Tuesday.
China began imposing restrictions on exporting gallium and germanium the same day and required their exporters to apply for special state permits, citing national security.
The materials are crucial for making a range of major products, including chips, solar panels and electric vehicles, and China is a major producer and exporter of the materials in the world.
South Korea's industry ministry held a meeting with associations of chipmakers, display firms and other related sectors in Seoul on Tuesday and discussed ways to protect the supply chains of the metals and related circumstances.
The Chinese move is expected to have a limited impact in the short run, but the Korean government and private sectors agreed to jointly enhance market monitoring and devise responses in a swift manner.
The government will set up consultation bodies to be in charge of sharing information on global supply situations and developing technologies for replacement.
In a recent survey of 400 major domestic importers and users of the items, companies voiced concerns about price hikes and clearance delays and called for the need to diversify import channels, the ministry said.
"The government will extend support for companies in ensuring the stable supplies of the materials," a ministry official said.
South Korea is heavily dependent on China and a handful of resource-rich nations for their supplies of key minerals for manufacturing.
China's export restriction is seen as an apparent retaliation for Washington restricting chip exports to China amid the intensifying Sino-U.S. rivalry, and some have pointed to the likelihood of further tit-for-tat moves by the United States and other nations.
Source: Yonhap News Agency