China has implemented new regulations requiring special licenses for the export of products containing more than 0.1% of rare earth metals and magnets originating from the country, effective December 1. This move is seen as a significant bargaining chip for Beijing in its trade negotiations with the United States, particularly concerning tariffs.
These critical minerals are essential components for a wide range of products, including electronics like iPhones, electric vehicles, and advanced military hardware such as F-35 fighter jets and Tomahawk missiles. Experts warn that China's near-monopoly on rare earth supply means it can significantly control or deny exports, impacting both the tech industry and defense contractors.
The new licensing requirements are expected to create substantial disruptions, with specific concerns that applications for products with military uses will likely be rejected, while those related to AI and chip production will face rigorous case-by-case review. This situation highlights the vulnerability of the US supply chain, as China also aims to limit exports of technologies crucial for domestic rare earth production elsewhere.
The timing of these regulations, just before a planned me... download the app to read more
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