The dominant position of China in the global supply chain of rare earth minerals is a cause of worry for the security establishment of the United States and its security body Pentagon said that it is important to reduce the dependence on China for these minerals. For this purpose, the US Defense Department has asked for fresh funds from the federal government to increase facilities for production of rare earth minerals, the pentagon said.
Air Force Lieutenant Colonel Mike Andrews, a Pentagon spokesman that the request for funds was outlines by the Pentagon in a report that has already been sent to the White House and briefed to the US Congress.
Rare earths are a group of 17 chemical elements that are put to use in a very wide range of products from high-tech consumer electronics to military equipment such as jet engines, satellites and lasers.
There are increasing concerns sin Washington that Beijing, which is a major player globally in this field, could use its dominant position to gain leverage and advantage in the trade war between the two countries – especially in the current situation when the trade sat is on the rise.
Between the years 2014 and 2017, out of the total import of rare earths by the United States, China accounted for about 80 per cent of that quantity. Rare earth imports have not been excluded from the recent tariffs imposed by the US on Chinese goods along with some other critical Chinese minerals. About 37 per cent of the global rare earths reserves are located within China and there are just a handful of alternative suppliers who have the prowess to rival China in this area.
“The department continues to work closely with the president, Congress and US industry to improve US competitiveness in the mineral market,” Andrews told the media.
While not providing any further details, he said that the report was linked to a federal program developed for increasing domestic production capabilities by providing targeted economic incentives.
Last year, about 120,000 tonnes of rare earth metals was produced by China.
While nothing explicitly has been said by Chinese authorities about any plans of it to curb its export of rare earths to the United States, this case has been strongly pursued by the Chinese media that have been claiming that this is a very strong possibility. Such predictions of curtailment of rare earths to the US have also been made on Twitter by the editor of influential Chinese news paper the Global Times late on Tuesday.
The ruling Communist Party’s official People’s Daily noted the “uncomfortable” dependence on rare earths from China of the United States in a commentary carrying the headline “United States, don’t underestimate China’s ability to strike back”.
“Will rare earths become a counter weapon for China to hit back against the pressure the United States has put on for no reason at all? The answer is no mystery,” it said.
There is an increasing probability that China would restrict rare earth exports to the US, believes John Neuffer, president of the Semiconductor Industry Association. “I do expect the other shoe to drop,” he told an event hosted by the Washington International Trade Association.
Increasing production, processing capacity and stockpiling of critical supplies is possible through US government funding, said John Luddy, vice president for national security policy at the Aerospace Industries Association.
(Adapted from StraitsTimes.com)