China has thinned the flow of rare earth a day after the US Congress called for more limits on exports of manufacturing equipment microchips. The remaining three weeks will be intense until Xi Jinping y Donald Trump are at the top of the APEC to seal peace, if there is luck, in the trade war. Until then, punishments to the opponent are foreseeable to arrive with a strengthened position. And in that dynamic it was certain that China would appeal to its ace of clubs, essential for several American industries, with which it already forced Trump’s surrender months ago.
Several statements were issued from the Chinese Ministry of Commerce this Thursday afternoon against USA no matter how much he insisted that they were not persecuting any specific country. The new regulations not only limit the trade in rare earths but require a license for the technology export that works for your extraction y prosecution. The procedure extends to foreign companies that trade in rare earths produced in China. Beijing intends to cover the cracks so that they do not reach the United States through third parties with the same formula that Washington applied to cut off the flow of semiconductors to China.
The statement explains that foreign organizations and individuals “have processed, directly or indirectly, rare earth items originating in China” and have sent them to sectors such as the military industry. “This has caused significant damage or potential threats to China’s security and national interests and has negatively affected the paz y stability of the world,” he justifies.
Uso dual
Beijing justify its restrictions in the International Treaty on the Non-Proliferation of Nuclear Weapons, which empowers its signatories to control the trade of “dual use products” (civil and military). It is so paradoxical that the United States needs Chinese rare earths to renew its fighters F-35missiles Tomahawk o drones Predator Beijing’s lack of enthusiasm to facilitate its task in these turbulent times is excusable. The Ministry of Commerce already sent letters months ago to the main South Korean companies threatening to turn off the tap if they continued exporting their products to the US arms industry.
The rare earth elements subject to restrictions are now 12 after the five added today: homio, europio, Iterbio, We are y Erbia. In another statement, China has included 14 foreign companies, mostly American and linked to the military sector, to its “unreliable” list that prohibits any commercial exchange with the country. Some of them supplied technology drones a Taiwan.
You already guessed the relevance of these rare earths Deng Xiaopingthe architect of economic openness, when he equated them to oil from the Middle East. Four decades later, they are the Chinese battering ram in the trade war and the reason that Trump asked for a draw in the trade war he had launched. It was enough for Beijing to cut off the flow for several American industries to warn of the imminent disaster. With them they are manufactured phones o televisions, airplanes y electric cars. They are as essential for the Army as for Health, to make the short list.
Negotiations and extensions
A phone call from Trump to Xi allowed the armistice and the flow of rare earths to the United States and chips to China again. Since then, negotiations and extensions to the tariff walls have continued while awaiting the final agreement. Some of the measures approved this Thursday by China will come into force on November 8, that is, just two days before the last extension expires.
Trump does not enjoy the enviable position that he anticipated months ago in his litigation because China has plenty of levers. For the first time in this century, it has not bought a single gram of military Americans. For its farmers, who last year sent shipments worth 12 billion dollars, it is a tragedy that China today resorts to Argentina o Brazil.
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