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Recent moves by the United States – including President Donald Trump’s meeting with leaders of resource-rich Central Asian countries and the expansion of a US government critical minerals list – signal an urgency in Washington to reduce its reliance on rare earths from China before tensions with Beijing flare up again, analysts said.
Despite China’s Ministry of Commerce on Sunday suspending export controls on “dual-use items” related to several key minerals for a year as part of the
US-China trade agreement reached in South Korea last month, US officials are still scouring the globe for alternative sources of rare earth elements.
“It would be very naive to think that China will not make it difficult again to access rare earth elements and critical minerals,” said Dexter Roberts, a US-based senior fellow at the Atlantic Council think tank’s Global China Hub. “The US doesn’t make it easy for China, either.”
According to the Centre for Strategic and International Studies, a prominent US think tank, China accounts for about 70 per cent of global mining and 90 per cent of processing output for the minerals, which are essential to the production of a slew of hi-tech goods, including cars and fighter jets. Beijing
has increasingly used its dominance of the industry as leverage in its negotiations with Washington amid the trade war.
With several provisions in the latest US-China trade agreement
due to expire next year, Washington appears to be stepping up efforts to diversify America’s supply of crucial resources.
Last week, the US Geological Survey added 10 new minerals – including copper and silver – to its updated list of critical minerals, bringing the total to 60, according to the Federal Register.
Meanwhile, Trump
hosted leaders of five Central Asian countries at the White House, a meeting that led the US and Uzbekistan to agree on a deal pledging up to US$400 million of investment to “strengthen US companies’ critical minerals and rare earths supply chains”, according to the US Department of State.
