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China tightens grip on rare earth metals to counter US-led push to end its monopoly
China has stepped up efforts to consolidate its monopoly over rare earth metals to counter the United States move to form an international alliance with over 50 nations, including India, to secure the supply chains of the precious metals to reduce reliance on Beijing.
Early this week, Chinese Premier Li Qiang visited Ganzhou in Jiangxi province, one of the world's largest production bases for heavy rare earth elements, a strategic resource essential to a range of hi-tech industries, where he called for China to consolidate its lead in industries like rare earths, over which it has a strategic edge over Washington.
Li also visited the Chinese Academy of Sciences' Ganjiang Innovation Academy, toured critical mineral producers, and had a meeting with local business leaders and researchers, official media reported.
"The value of rare earths in boosting advanced manufacturing and green, low-carbon transformation is increasingly prominent," he said.
China's dominance of global mining and processing of the minerals has become a crucial strategic advantage in recent years, giving it vital leverage when sparring with the US over a string of trade and technology disputes.
Li also met producers of the critical minerals, local business leaders and researchers during his tour, Xinhua reported.
"The value of rare earths in boosting advanced manufacturing and green, low-carbon transformation is increasingly prominent," he said.
Li's visit comes in the backdrop of intensified efforts by the US to form an international alliance after China increased its chokehold on its exports of rare earth metals to the US, EU, India and various other countries, creating supply chain chaos of the precious metals.
China accounts for about 70 per cent of global rare earth mining and nearly 90 per cent of their processing.
The minerals are critical for manufacturing electronics, automobiles, wind energy, and defence equipment and a host of modern gadgets.
Beijing halted the exports of the key elements to use them as leverage to expand its trade interests.
China used its chokehold on rare earth exports to force US President Donald Trump to cut high tariffs and settle for a quid pro quo deal under which Beijing had agreed to resume rare-earth supplies to Washington, lifting the ban on exports of semiconductor chips.
China also restricted the exports of the rare-earth metals to India, resulting in shortages in automobile and other industries.
After this, the Trump administration, early this month, launched a major initiative to build a "metallic alliance" with over 50 nations, including India, to secure critical mineral supply chains and reduce reliance on China.
The US government has initiated a USD 12 billion stockpile strategy called "Project Vault" to finance domestic and allied mining and processing.
In Ganzhou, Li signalled the importance of solidifying China's competitiveness in traditional industries to spur on technological innovation, calling for expanding the application of rare earths in fields like green energy and new materials, the Hong Kong-based South China Morning Post reported.
He also chaired a meeting of the State Council, China's cabinet, on harnessing artificial intelligence to empower other industries.
Li urged policymakers to deepen their grasp of AI development trends and advance innovations in algorithms and large language models, increase China's supply of high-quality data and computing power, and proactively explore new technological pathways. He said the goal was to make breakthroughs across the entire AI chain.
"We must cultivate an ecosystem forming synergy from data, computing, electricity, network resources, and software and hardware," he said.
Source: EconomicTimes
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