Greer and Bessent Urge China to Halt Rare Earths Export Restrictions

U.S. officials have voiced strong concerns regarding China’s recent expansion of export restrictions on rare earth elements. This move is seen as a direct threat to global supply chains. U.S. Trade Representative Jamieson Greer labeled these actions a “global supply-chain power grab.” Both Greer and Treasury Secretary Scott Bessent emphasized that while tensions are high, the U.S. does not favor escalating the situation.

Calls for Change in China’s Export Policy

During a press conference, Greer noted that China’s updated regulatory framework for rare earths has not yet been implemented. He suggested that there is still an opportunity for China to reverse its decision. Meanwhile, the U.S. has not enacted a planned 100% tariff increase on Chinese goods either.

Future Negotiations and Truce Extensions

U.S. officials stressed their commitment to avoiding conflict, especially ahead of a planned meeting between President Trump and President Xi Jinping later this month. Currently, both nations are in a 90-day truce regarding tariffs, which has been extended multiple times. Bessent indicated that a longer extension might be negotiable to delay the imposition of new restrictions.

• Key Discussions: U.S.-China dialogue is ongoing, with officials meeting at the IMF-World Bank gathering.
• Potential Tariff Actions: Trump has threatened an additional 100% increase in tariffs if negotiations fail.

Concerns Over Reliability

The U.S. does not seek complete economic decoupling from China. However, officials noted the necessity to act if Beijing becomes an unreliable supplier of essential materials. Bessent highlighted that recent indications of delayed shipments of rare earth magnets have intensified concerns.

Global Implications

Bessent argued that China’s actions threaten not just U.S. interests but also global stability. He pointed out that China’s support for Russia amidst the Ukraine crisis underscores the risks associated with reliance on Beijing. He stated that if China continues on this path, the world might be forced to decouple economically.

• Future Actions: The U.S. may consider export controls and tariffs on Chinese imports, particularly concerning Russian oil shipments.
• Trade Diplomatic Meetings: G7 nations plan to discuss these trade issues further during their ongoing meetings.

As tensions escalate, the focus remains on finding a resolution that maintains the flow of rare earth exports and stabilizes global markets.