China threatens US on the Rare Earths Minerals issue; US Defence Department submits report to the Congress

Third World WarWashington/Beijing: China has threatened that Rare Earth Minerals can be a counter weapon, in the hands of China and the United States should not underestimate the power of Chinese retaliation. The official newspaper of the Chinese ruling communist party, the Peoples Daily carried this threat, and China has started preparations to stop the export of Rare Earth Minerals, to the United States. Against this background, the US defence department submitted a special report to the US Congress exploring a different option in case China decided to stop the supply of Rare Earth Minerals.

Two weeks ago, US President, Donald Trump indicated a further intensification of the trade war with China. While threatening to tax the entire Chinese goods import, he declared an emergency against foreign telecom companies. The factors behind this are said to be, investments of the Chinese telecom companies in the United States, increasing influence and threat to national security. Following the emergency, the US trade department announced a Black List of 70 companies, including Huawei from China and banned these companies. 

The trade talks between the United States and China also have failed, and President Trump has announced the inclusion of China, in the Currency Monitoring List. While there are consistent attacks from the United States, targeting the Chinese economy, including the trade, there has been no strong retaliation from the Chinese side. China has not taken any important decision other than imposing a tax on US goods imported into China. But China indicated actions to target US companies.

At the same time, the issue of Rare Earth Minerals has come on the anvil, and as per indications since the last few days, China will use it as a decisive weapon. A few days ago, Chinese President Xi Jinping visited the leading Chinese company in the Rare Earth Minerals sector. Jinping had made a statement during this visit that these minerals are very important for progress in the technology sector and have strategic importance.

China is known to be the largest producer of the minerals, necessary for the manufacture of smartphones, computers and electric cars. It is claimed that China has 30% of the world’s deposits, of these 17 Rare Earth Minerals. China has a share of 95% in the current production of Rare Earth Minerals. 80% of the Rare Earth Minerals required by the United States are imported from China.

The massive use of Rare Earth Minerals in the defence and technology sectors has become an important issue for the United States. Although a mine of Rare Earth Minerals is operational in the United States, the processing is done in China. For this, the Mountain Pass Company exports nearly 50,000 tonnes of Rare Earth Minerals to China for Processing and reimports them. But the trade war intensity is likely to affect this arrangement, and the United States will have to make alternative arrangements urgently. 

The US defence department has submitted a report to the US Congress listing the various possibilities, options and proposals regarding the Rare Earth Minerals. The report suggests that additional funding is required in the United States to prevent the shortage of Rare Earth Minerals and the concerned companies should be directed to stock more and more and for emergencies. At the same time, the report instructs to exploring the possibility of countries other than China and take rapid steps to fulfil the requirement.

Earlier, in 2010, China had made the Japanese leadership bow, stopping the supply of Rare Earth Minerals. Fears are being expressed in the US circles that China can repeat the strategy against the United States. 

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