URGENT UPDATE: President Donald Trump has just announced plans to escalate U.S. tariffs on China in response to new restrictions on rare earth elements. The threat comes after China implemented tighter export controls on these critical minerals, which are essential for manufacturing high-tech products including semiconductors and electric car batteries.
In a striking social media post on Truth Social, Trump described China’s actions as “very hostile.” He emphasized that the country is attempting to impose export controls on all production related to rare earths, even if those products are not manufactured in China. “They are becoming very hostile, and sending letters to countries throughout the world,” Trump stated.
China’s new regulations, effective as of Thursday, require companies to obtain special approval for exporting any product containing even trace amounts of rare earths sourced from China, including those produced by non-Chinese manufacturers. This move has raised alarms in Washington, particularly since China produces up to 95% of the world’s rare earth magnets, according to energy research firm Wood Mackenzie.
The implications of these restrictions are significant for U.S.-China trade relations, which have been fragile. Trump expressed surprise and vowed retaliatory measures, stating, “One of the policies that we are calculating at this moment is a massive increase of tariffs on Chinese products coming into the United States of America.” He also mentioned that several other countermeasures are “under serious consideration.”
Furthermore, Trump indicated that he might cancel a planned meeting with Chinese President Xi Jinping during the upcoming Asia-Pacific Economic Cooperation summit in South Korea later this month if China proceeds with the export controls.
This development comes on the heels of a framework agreement reached in June between the U.S. and China, which aimed to ease tensions over tariffs and rare earth exports. The sudden shift in China’s policy could derail those efforts, escalating tensions further.
Trade experts warn that the increased tariffs could have severe repercussions for industries reliant on rare earth materials, potentially driving up costs for consumers and manufacturers alike. As the situation unfolds, all eyes are on Washington and Beijing to see how they will respond to this escalating trade war over critical resources.
Stay tuned for more updates as this story develops.
