According to the latest research report from South Korea, as the trade war between the United States and China continues to escalate, the Chinese Communist Party (CCP) is continuously strengthening its export control over strategic minerals and key resources. In the first half of 2025, the number of administrative penalties imposed by the CCP on foreign companies for export control increased by more than 70% compared to the previous year, indicating a significant escalation in enforcement efforts. However, this move may accelerate the global supply chain’s process of “de-Chinification,” potentially leading to adverse effects on the Chinese economy.
While intensifying control over strategic minerals such as rare earths and graphite, the CCP has further included “silver” in the scope of export permit management at the beginning of 2026, continuing to expand the list of controlled minerals and industrial raw materials. Some analyses suggest that these measures will expose foreign companies to higher compliance risks, necessitating the establishment of more cautious and systematic response mechanisms.
The report released by the South Korean Trade Security Management Institute on January 5, entitled “Current Situation of China’s Product Export Control Mechanism and Countermeasures,” indicated that the total number of publicized export control-related administrative penalty decisions by various levels of Chinese customs in the first half of 2025 was 79, a 71.7% increase from the 46 cases during the same period in 2024.
The report also noted that the Chinese government has not publicly disclosed complete and unified export control statistics. The analysis in this report is based on the results obtained from the compilation of publicly available secondary data.
At the institutional level, the CCP enacted the “Export Control Law” in 2020 and further promulgated the “Dual-use Item Export Control Regulations” in 2024, gradually improving the legal framework and providing institutional foundations for the normalization of export controls.
The analysis in the report suggests that following the second term of President Trump’s government coming into power in early 2025, the United States intensified sanctions against China with measures such as increased tariffs and technological restrictions, prompting retaliatory actions from the CCP. Starting from April 2025, China restricted some rare earth exports to the United States, and in October of the same year, formally included elements such as terbium and dysprosium in the export control list, showing a trend of ongoing escalation in related measures.
Additionally, the report mentioned that China had planned to implement an export permit system for products from overseas companies containing as little as 0.1% of Chinese rare earths. While this measure was originally scheduled to be implemented in 2025, following the U.S.-China leaders’ summit in Gyeongju in October 2025, both parties agreed to postpone the policy for a year, temporarily easing global supply chain concerns.
In terms of violation types, cases related to “dual-use items” accounted for 52 cases, representing 65.8% and ranking first among various categories; cases related to military supplies accounted for 12, accounting for 27.8%; and other cases involving restricted or prohibited export items accounted for 5 cases, representing 6.3%.
Regarding specific violation categories, graphite and related products accounted for the highest proportion at 29%; among other cases were instances of illegal exports of drones and various controlled chemical substances. It is worth noting that although the control period for some key minerals, rare metals, and permanent magnetic materials is relatively short, the related cases have accounted for 7% and 6% of all cases handled, respectively, indicating that actual violations have begun to emerge.
On the enforcement front, the CCP has significantly increased the penalties for export control violations. In 2024, about 90% of cases received mitigated or lenient penalties, with no instances of increased penalties. However, starting from the first half of 2025, cases involving substantial fines showed a significant increase.
The data shows that in the first half of 2025, the average ratio of violation amounts to fines reached 106%, far higher than the 25% during the same period of the previous year. The average fine ratio was 44% in the first quarter and jumped to 178% in the second quarter, indicating a particularly noticeable increase.
Entering 2026, the CCP continues to tighten export controls by formally incorporating silver into export permit management. Silver is not only a precious metal but also an essential raw material for industries such as electronics, batteries, solar panels, and medical equipment. Although China is one of the world’s major silver-producing countries, the report points out that South Korea has a low dependency on Chinese silver imports, being a producer and exporter of silver itself, thereby expecting relatively limited impact.
In conclusion, the report highlights the shift in China’s export control policy from a past passive response focusing on core minerals and general technologies to a more forward-looking, normalized, and precise policy tool. However, this move may also accelerate the global supply chain’s “de-Chinification” process, potentially leading to adverse effects on China’s own economic and industrial development.