China has set another checkmate obviously against US. It is trying to hurt US defense contractors by limiting supplies of rare-earth minerals that are critical to the industry.
China knows it really well that how badly companies in the US and Europe would be affected if they restricted rare-earth exports during a bilateral dispute. China’s Foreign Ministry didn’t respond to a request for comment on a public holiday. The government last month issued draft guidelines for the sector which included firms abiding by export regulations.
Trade war marked the beginning of export curbs in 2019. China accounts for nearly 80% of rare-earth imports into the US. Meanwhile, Beijing had prepared a plan to restrict shipments as a way to target Washington. These plans forced the American government to seek out new ways to cut their reliance on a single source.
Last year, Donald Trump signed an executive order which aimed at expanding domestic output of rare-earth minerals. Following year, the Department of Defense was ordered to spur the production of magnets. The US also received Lynas Rare Earths Ltd., the award for biggest producer outside China. This in a way accelerated US to boost processing capabilities.