China's Rare Earth Policy: A Magnet for Global Tensions

China, holding a near-monopoly on rare earth magnets vital for electric vehicles, has added export controls on these components, impacting global supply chains. This move, seen as part of the trade tensions with the U.S., affects numerous sectors and has led to a bureaucratic backlog in licensing.


Devdiscourse News Desk | Updated: 05-06-2025 19:29 IST | Created: 05-06-2025 19:29 IST
China's Rare Earth Policy: A Magnet for Global Tensions
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In a strategic maneuver, China's Ministry of Commerce, operating out of an unassuming building near Tiananmen Square, has tightened its grip on the global auto industry. By imposing export controls on rare earth magnets—crucial for electric vehicles—China is wielding its near-monopoly as a geopolitical tool.

These export controls, introduced as part of China's trade skirmish with the U.S., place the Bureau of Industrial Security and Import and Export Control at the forefront of this contentious strategy. The Bureau, tasked with vetting export permits, has granted only a small fraction of the avalanche of applications from industries worldwide.

Amidst accusations of strategic delay from the U.S., China maintains the non-discriminatory nature of these controls, even as rare earths become a pivotal point in high-stakes U.S.-China discussions. The bottleneck in processing reflects both bureaucratic challenges and strategic calculations in this ongoing trade duel.

(With inputs from agencies.)

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