Tensions over rare earth controls rise as US and China trade barbs

BEIJING – Chinese state media on Oct 16 issued a seven-point rebuttal to US calls for Beijing to wind back its rare earth controls, as both sides struggle to move beyond a volley of barbs and accusations of blindsiding the other.

US Trade Representative Jamieson Greer on Oct 15 called China’s new rare earth export restrictions “a global supply-chain power grab”, and suggested that Beijing could stave off US President Donald Trump’s threat to

reimpose triple-digit tariffs on Chinese goods

by shelving the measures set to take effect on Nov 8.

Beijing maintains it not only notified Washington before announcing the new licensing regime, but that the controls are also consistent with measures long in place in other major economies.

The US and China have been embroiled in a war of words since a telephone call in September between Mr Trump and Chinese leader Xi Jinping, with each accusing the other of stoking tensions weeks ahead of an expected meeting between the two men.

Beijing attributes the ramped-up rhetoric to the US Commerce Department’s surprise expansion of its “Entity List” in late September to include companies in China and elsewhere that use subsidiaries to bypass export restrictions on chipmaking equipment and other high-tech goods.

Washington pins the start to China’s critical minerals move, which Mr Trump described as shocking.

“The United States has long overstated national security concerns and abused controls, adopting discriminatory practices against China,” read one of seven infographics published by People’s Daily, the official newspaper of the governing Communist Party.

The poster added that Washington maintains a control list over 3,000 items long, compared with the 900 on Beijing’s catalogue.

“Implementing such export controls is consistent with international practice,” the first poster said, reiterating Beijing’s stance on the measures since their announcement.

Washington has had similar rules since the 1950s, and has been using them in recent years to stop foreign semiconductor companies from selling chips to China if they are made using US technology.

“Washington should not be surprised by

China’s ‘tit-for-tat’

,” read an editorial in the Global Times, a People’s Daily-owned tabloid, which has often been first to report on China’s next steps in trade disagreements.

“The sudden shift in the trade atmosphere caught many by surprise, yet that’s not surprising,” the editorial continued.

“The direct trigger for this round of tension was Washington’s breach of promises – an all-too familiar pattern.” REUTERS