US blasts China's rare earth export curbs as 'power grab', warns of supply chain risks - Singapore News

WASHINGTON: Tensions between the US and China are flaring again — this time over rare earth minerals, the vital materials powering everything from smartphones to missile systems.

On Wednesday, top US officials blasted Beijing’s new plan to tighten control over these critical exports, calling it a dangerous move that could disrupt global supply chains and threaten industries around the world.

“This is a global supply-chain power grab,” said US Trade Representative Jamieson Greer at a press conference. According to Greer, while China hasn’t pulled the trigger yet, but the threat is real — and they’re ready to respond if they do.

Greer, alongside Treasury Secretary Scott Bessent, warned that China’s potential export restrictions could lead to stronger countermeasures from Washington, though both emphasised they’d prefer diplomacy over confrontation.

Timing couldn’t be worse: Trump and Xi set to meet soon

The dispute comes just weeks ahead of a high-stakes meeting between President Trump and Chinese President Xi Jinping, scheduled to take place in South Korea. Both sides are walking a tightrope: keeping talks alive while preparing for a possible showdown.

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“We’re not aiming for decoupling,” Bessent said, referring to a full-scale economic split between the two superpowers. But according to Bessent, the US can’t let their industries — or allies — be held hostage by a supplier willing to use resources as a weapon.

For now, the situation remains in a tense holding pattern. China’s rare earth exports are still flowing, and the US hasn’t moved forward with its threatened 100% tariff hike. Bessent hinted that if China holds off on its restrictions, the US might extend a fragile 90-day agreement — buying both sides more time.

US allies alarmed: Japan calls for a united front

The threat of Chinese export controls has sent shock waves through global markets. Japan’s Finance Minister, Katsunobu Kato raised strong concerns in a recent G7 meeting, urging a coordinated international response.

Kato warned that if this spirals into a cycle of retaliation, it could seriously destabilize the global economy.

Although the G7 hasn’t released a joint statement yet, behind-the-scenes discussions are in full swing, highlighting growing global unease over China’s economic muscle-flexing.

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Trade war expands, new port fees and old tensions

Rare earths are just the latest flashpoint in a broader trade war between the US and China. This week, both countries rolled out new port fees — a tit-for-tat move that overshadowed global economic meetings in Washington, even as the IMF upgraded its growth forecast thanks to signs of easing tensions.

Still, US officials say trust is wearing thin. They point to recent delays in rare earth shipments to American automakers — which China dismissed as “holiday-related” — as evidence of deeper unreliability.

Bessent added that today it’s rare earths, tomorrow will be something else, and stressed that this isn’t just about minerals, it’s about global stability.

China accused of helping Russia

Beyond trade, the US is sounding the alarm over national security. Officials accused China of indirectly aiding Russia’s war in Ukraine by supplying parts used in Russian drones.

According to Bessent, Washington plans to release images — provided by Ukraine — showing Chinese components in downed drones. If China continues down this path, Bessent reiterated, unreliable on trade, complicit in aggression — the world will have to reduce its dependence, he concluded.

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The US is also weighing tougher penalties, including tariffs and export controls, possibly targeting China’s purchases of Russian oil. So far, those measures have been used only against countries like India, which import smaller amounts.

A fragile truce nears a breaking point

Beneath all the diplomatic language, it’s clear that tensions are rising fast. US officials revealed that in August, a senior Chinese negotiator threatened to “unleash chaos” on the global system if the US pressed forward with port fee hikes.

Bessent highlighted that these aren’t knee-jerk reactions but part of a long-term strategy. If Beijing really wants to avoid a full-blown spli, the next move is theirs, Bessent challenged.

As the Trump-Xi summit approaches, the world is watching closely. With rare earths, technology, and geopolitics all in play, the stakes have never been higher.

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