China to Tighten Export Controls on Lithium-Ion Batteries and Synthetic Diamonds

China will impose export restrictions on lithium-ion batteries and synthetic diamonds starting November 8, in response to high U.S. tariffs under the Trump administration. Since China supplies about 77% of America’s synthetic diamond powder, experts fear the move could disrupt U.S. supply chains. The situation may become a lose-lose scenario—U.S. chip bans hinder China’s AI growth, while China’s battery limits could restrict U.S. AI infrastructure—highlighting the need for resolution at the upcoming APEC summit between Presidents Trump and Xi.

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*Source: https://source.benchmarkminerals.com/article/china-extends-export-controls-to-lithium-ion-batteries-and-battery-materials

China imposes strict export restrictions on Lithium-Ion Batteries and Synthetic Diamonds. 

According to Ming Pao, China’s new restrictions are expected to take effect on November 8th. These measures are Beijing’s counteraction against new policies regarding high tariffs imposed by the Trump administration. This is an important policy, as Lithium ion batteries are essential components for smartphones, electric vehicles, or medical devices. 

Many experts worry that Trump’s policies and China’s reactions towards them could disrupt the U.S. supply chain. This is because China’s supply accounts for about 77% of America's synthetic diamond powder. If China leverages its dominance to pressure the U.S., the U.S. may have no choice but to adhere to the demands of China. In fact, this could become a lose-lose game because U.S. chip export bans can limit China’s AI development while China’s battery restriction could constrain the AI infrastructure of the U.S. The escalating tensions between the countries call for a quick resolution of the conflict between President Trump and President Xi at the upcoming APEC summit.