Armenia awaits results as counting continues in high-stakes elections
Counting is underway in Armenia's elections. The results of the vote are set to determine the political direction of the country of three million peop...
China is intensifying its strategic use of rare earth exports as leverage in the ongoing trade dispute with the United States, signaling a shift in the battleground of economic confrontation.
Analysts say Beijing's newly expanded export licence system has become a precise and potent instrument, providing both a bottleneck for global supply chains and a tool for geopolitical influence.
The issue took center stage in Thursday’s call between U.S. President Donald Trump and Chinese President Xi Jinping. Trump described the discussion as focusing on “rare earth magnets and some other things,” but no breakthrough was announced. Meanwhile, several European auto suppliers reported production disruptions this week due to depleted inventories of rare earth magnets.
China’s export licence requirements, introduced in April, now apply globally to some of the most advanced rare earth magnet types. These magnets are critical for electric vehicle motors, military technology, and high-end electronics. By controlling approvals, Beijing has turned a small commerce ministry office into a key choke point in the global manufacturing system.
“Beijing has a degree of plausible deniability — no one can prove China is doing this on purpose,” said Noah Barkin of the Rhodium Group. “But the rate of approvals is a clear signal that China is exerting pressure to prevent trade negotiations with the U.S. from leading to more technology controls.”
Although China mines about 70% of the world’s rare earths, it dominates over 90% of global refining capacity. That gives Beijing near-total control over the finished materials that feed global supply chains. The latest restrictions mirror the structure of U.S. export controls and mark a continuation of China’s efforts to develop its own sanctions framework, first formalized in its 2020 Export Control Law.
“China originally took inspiration for these export control methods from the comprehensive U.S. sanctions regime,” said Zhu Junwei of the Grandview Institution, a Beijing-based think tank. “It’s a system designed for strategic use — a last resort.”
China’s approach also enables surveillance of how and where rare earth materials are used globally — intelligence other governments cannot easily obtain due to supply chain complexity. A U.S.-based executive, speaking anonymously, described the system as “sharpening China’s scalpel,” not merely overseeing exports but gaining strategic insight and influence.
The implications are broad. Hundreds of Japanese companies reportedly face delays as they await export licences, and many Western firms are seeking alternative supply chains, a difficult and slow process. Industry observers note the opaque nature of Beijing’s licence approvals, with little public data and companies reluctant to disclose outcomes.
China’s weaponization of rare earths is not new. In 2010, it temporarily halted exports to Japan over a territorial dispute. As early as 1992, former Chinese leader Deng Xiaoping famously said, “The Middle East has oil, China has rare earths.”
In recent years, the strategy has become more structured. After U.S. export bans on advanced semiconductors and chipmaking tools in 2022, China retaliated with its own controls — first on gallium and germanium, then expanding to graphite and five additional metals crucial to defense and green energy sectors.
Though Trump suggested some progress was made during his call with Xi, the long-term trajectory remains uncertain. Analysts warn that the real impact of China’s rare earth strategy lies not only in current export restrictions but in the strategic advantage and information it now commands over global industrial dependencies.
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