China's Rare-earth Monopoly and Geopolitics
China's new rare-earth export controls have strengthened its dominance, extending restrictions to technology, equipment, and expertise, tightening global dependence.
This move has intensified tensions with the US and its allies, highlighting control over critical minerals as a key factor in economic and geopolitical power.
- The controls affect not only the US but also European, Asian, and African companies trying to build alternative supply chains.
- Export licenses are linked to the use of Chinese equipment or inputs, making it difficult for companies to diversify.
- A ban on Chinese personnel exporting their expertise prevents the transfer of know-how, making domestic processing challenging without experienced engineers and technicians.
Control over critical minerals now defines the balance of economic and geopolitical power.
The result is increased cost and complexity of diversification, as supply chains can be rerouted but at a heavy cost.
Author's summary: China's rare-earth monopoly impacts global geopolitics.