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New Zealand's longest-running online daily news and commentary publication, now in its 25th year. The opinion pieces presented here are not purported to be fact but reasonable effort is made to ensure accuracy.

Content copyright © 1995 - 2019 to Bruce Simpson (aka Aardvark), the logo was kindly created for Aardvark Daily by the folks at aardvark.co.uk



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Another skirmish in the tech trade wars

29 Aug 2024

The cold war of the 1950s has been replaced by a new hi-tech trade war with China and the USA going head-to-head.

We've seen a series of tit-for-tat exchanges between these two superpowers, each restricting or heavily taxing imports or restricting exports in an attempt to apply pressure to the other -- all under the guise of "security".

The reality is that although security may be one of the concerns, the primary driver of these exchanges is almost certainly more about money and profits than it is about anything else.

And now China is making a move that could have far-reaching effects on Western nations.

According to reports, China is significantly restricting the export of certain elements that are critical to modern semiconductors and other hi-tech components.

Germanium is used in the fabrication of semiconductors as well as for things such as lenses that operate at infrared frequencies for use in thermal cameras.

Gallium is a low melting point metal with a wide array of applications in the tech field.

Ninety-eight percent of the world's gallium comes from China, as does around 60 percent of germainum so any restrictions placed on their export could have some significant flow-on effects within many areas of technology.

Although shortages of products requiring these materials have yet to appear, prices for germanium have soared by over 50 percent in the past few months and some manufacturers are already eating into their reserves to meet demand.

Given the strategic value of modern micro-electronics, night vision goggles and other dependent technologies, China's restrictions on the export of these metals and their dominance of the supply market could place western powers in a difficult situation. As military conflicts errupt around the world, a lack of components deemed critical to maintaining a defensive capability must surely give China a huge edge, should a much larger-scale engagement eventuate.

Meanwhile, Canada has just announced that it will be slapping Chinese-made EVs with a 100 percent import tax... WTF?

We have just about every western nation crowing about how much they're doing to protect the environment and legislating the end of ICE vehicles within a decade or so then, simultaneously, making it almost impossible for people to affordably transition from their old gas-guzler to a new, cleaner EV.

Of course here in New Zealand, your EV may be a bit of a gamble because it's become very clear that power companies are taking a very short-sighted view to profits and investing in future dependable generation. As a result, Meridian announced a massive profit this week -- at the same time we're being told that businesses may close due to the price of power.

Those previous two stories show the lunacy that pervades our government. In the second story it says:

Manufacturing and industrial companies are being put "in a perilous situation" by 'gentailers' who show no regard for the country's interests, Associate Energy Minister Shane Jones says.

Does Shane Jones not realise that Meridian is 51 percent owned by his government?

To criticise Meridian (amongst others) for behaving badly is just a joke -- when you have a controlling interest in the company itself. Don't just cry, actually do something!

Ah... but as a 51 percent shareholder, the current government is not going to do *anything* that might reduce the huge dividend that will be paid to them from that massive prifit are they?

Therefore, Shane Jones' words are merely rhetoric, designed to make it look like he's concerned when in fact he, and his parliamentary peers, are laughing all the way to the bank.

Oops, kinda drifted away from the original subject of todays column -- but it had to be said.

Carpe Diem folks!

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