South Africa Courts EV Makers, China Proposes EV Tech Controls

China considers EV battery technology export restrictions

The announcement of South Africa’s tax incentive came just over a week before China’s proposal to impose new export restrictions on EV-related technology.

Beijing’s Commerce Ministry is reviewing measures that would limit the export of battery cathode technology and techniques used in mineral extraction critical to EV production, according to CNN.

China’s proposal forms part of broader and escalating trade tensions with the United States.

In recent months, China imposed restrictions on the sale of gallium, germanium and antimony, essential materials for semiconductors and advanced technologies.

The latest proposed measures could further impact global supply chains, reinforcing China’s dominance in lithium processing and EV battery production.

“What we can tell you as a principle is that China implements fair, reasonable and non-discriminatory export control measures,” Mao Ning, spokesperson for China’s Foreign Ministry, said in a press conference on January 4.

Industry analysts suggest that the proposed curbs may serve as leverage in trade negotiations, with potential implications for Western automakers reliant on Chinese technology.

South Africa’s position as a producer of key minerals places it at the center of this evolving landscape.

The global market for lithium-ion batteries and electric vehicles is projected to grow significantly over the next decade. McKinsey forecasts sales of passenger electric vehicles to rise from 4.5 million in 2021 to 28 million in 2030.

Currently, China controls around 70 percent of global lithium processing. Industry analysts believe that further export restrictions would reinforce this position.

BYD (OTC Pink:BYDDF,HKEX:1211), one of China’s largest EV manufacturers, has accelerated its international expansion, while CATL (SZSE:300750), the world’s leading battery producer, holds approximately 40 percent of the global market share.

The South African government is expected to consult with industry stakeholders on additional measures to support the automotive transition.

Meanwhile, automakers will closely monitor developments in China’s export policy, recognizing the potential impact on global supply chains and future investments.