China clamps down more curbs on export of rare-earth technologies

Beijing, Oct 9 (PTI) China, which virtually holds a monopoly over rare earth materials, on Thursday announced further export controls for mining and processing the minerals, alleging that unnamed foreign firms are using its supplies for military purposes.   China's Commerce Ministry said that it would impose export control measures with immediate effect on technologies related to rare earths.

Exports of technologies and their carriers related to rare earths mining, smelting and separation, as well as metal smelting, magnetic material manufacturing, and the recycling and utilisation of rare earths from secondary sources, will not be permitted without approval, it said.

China accounts for about 70 per cent of the world's rare earth mining, but it controls about 90 per cent of their processing, which makes it virtually the sole supplier of the precious metals used in a host of modern equipment, including automobiles, electronics, wind energy, and defence.

China’s rare earth metals are in demand as the US, EU, and India are its top importers.

So much so that US President Donald Trump, who earlier imposed 145 per cent tariffs against Chinese exports, settled for an interim trade deal after China stopped the rare earths exports, linking them to the lifting of curbs on semiconductor chips by the US.

Rare earths are a key component of current trade talks between the US and Beijing.

China’s new curbs on them came ahead of the planned meeting between Trump and Chinese President Xi Jinping on the sidelines of the Asia-Pacific Economic Cooperation forum in South Korea (APEC) later this month.

Rare earths have also become an important part of India-China talks in recent months.

While relations between the two countries improved after the August 31 meeting between Xi and Prime Minister Narendra Modi in Tianjin, Beijing is yet to relent on its restrictions on rare earths exports to India, which affected India’s automobile industry.

The Chinese Commerce Ministry said, “Some overseas organisations and individuals are directly processing rare earth items originating in China and then transferring or providing them to relevant organisations and individuals.” “The items were directly or indirectly used in sensitive areas such as military operations, causing significant damage or potential threats to China’s national security and interests,” it said.

It clarified that exports for humanitarian assistance purposes, including emergency medical care, public health emergency response and disaster relief, will be exempt from the licensing requirement.

China clamped controls on the export of specific minerals in July 2023 and steadily expanded the number of rare earths subject to these controls since then. Besides the US and India, the European Union too has been negotiating hard to lift the curbs. PTI KJV ZH ZH