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How China used rare earths and the US playbook to turn on the chip tap again
Washington tried to slow Chinese AI progress with export bans, a tactic Beijing later employed to regain some ground
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Rare earths are needed for everything from consumer electronics to electric vehicles, wind turbines and fighter jets – and China controls the supply chain. In the third of a four-part series, we look at how Beijing’s dominance in the critical minerals is matching up to Washington’s lead in artificial intelligence, as well as how they are related.
When the US president unveiled his tariffs in April, China knew it had a trump card that had been quietly gaining in value over the decades and that no other country in the world held.
As the threatened tariffs rose, Beijing announced that it was imposing export controls on seven rare earth elements and magnets.
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Rare earths are essential components in many technologies, from consumer electronics and electric vehicles, through clean energy and aerospace, to medical and defence equipment. They are also used in research and development, including semiconductors.
China holds half of the world’s reserves of rare earths and most of the global refining capacity.
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And from 2020 to 2023, 70 per cent of rare earth compounds and metals imported by the United States were from China, according to the US Geological Survey.
By some US estimates, limits on access to these minerals could affect nearly 78 per cent of all Pentagon weapons systems.
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