Chinese President Xi Jinping (習近平) early last month visited a rare earths company in Jiangxi Province. The visit caused speculation that China might reduce its supply of rare earths to the US as a countermeasure in the trade dispute between the two countries.
After several decades of hard work, China is the global leader in mining, processing, separating and purifying rare earths, and has built a complete rare earth industry chain.
China’s output of rare earths reached 120,000 tonnes last year, much higher than Australia’s 20,000 tonnes in second place and the US’ 15,000 tonnes in third, US Geological Survey data showed.
Chinese output accounted for 70 percent of the global output of 170,000 tonnes.
The US last year imported 18,000 tonnes of rare earths, including rare earth compounds. Eighty percent came from China, but that accounted for only 4 percent of total Chinese output. Part of the reason is that most US manufacturers that need rare earth metals relocated their factories to China after 2010.
In 2010 and 2011, China-Japan relations deteriorated due to disputes over the Diaoyutai Islands (釣魚台), known as the Senkaku Islands in Japan. This led to Chinese restrictions on rare earth exports to Japan and Japanese businesses being forced to turn to Australia and develop alternative techniques.
In June 2012, the Agency for Natural Resources and Energy under the Japanese Ministry of Economy, Trade and Industry issued a resource security strategy, asking government agencies dealing with countries with critical resources such as rare earths to adopt comprehensive complementary measures to ensure a stable supply.
As a result, other countries have attached great importance to the security of critical resources such as rare earths.
The US in 1946 passed the Strategic and Critical Materials Stockpiling Act, requiring the federal government to stockpile certain kinds of strategic and critical materials, and encouraging protection and development of domestic material sources.
Faced with the threat posed by China’s rare earth production advantage, US President Donald Trump in December 2017 signed Executive Order No. 13,817.
It instructs federal agencies to create a list of critical minerals in the hope of reducing reliance on them and to boost domestic supply.
There are large global reserves of rare earths, but thanks to its world-leading mining and separation techniques, China uses rare earths as a bargaining chip in diplomatic, economic and trade disputes. This has forced the US, Japan and the EU to respond with legislation.
As it takes time and effort to build a rare earth industry chain, a Chinese ban on rare earth exports is likely to put pressure on the US high-tech and defense industries in the short term, and it could harm industrialized countries around the world.
Taiwan imports 3,000 tonnes of rare earths yearly, playing no role in the global rare earth industry chain. Some Taiwanese businesses last year established the Taiwan Rare Earths and Rare Resources Industry Alliance to build a domestic rare earth industry supply chain.
This shows that local companies are alert to the need for a secure supply of critical resources.
As the trade dispute escalates, the government should think ahead, and work with industry and academia to evaluate critical resource supply risks and draw up an appropriate strategy for recycling and stockpiling such resources.
Young Chea-yuan is a professor at Chinese Culture University’s Department of Natural Resources.
Translated by Eddy Chang
Speaking at the Asia-Pacific Forward Forum in Taipei, former Singaporean minister for foreign affairs George Yeo (楊榮文) proposed a “Chinese commonwealth” as a potential framework for political integration between Taiwan and China. Yeo said the “status quo” in the Taiwan Strait is unsustainable and that Taiwan should not be “a piece on the chessboard” in a geopolitical game between China and the US. Yeo’s remark is nothing but an ill-intentioned political maneuver that is made by all pro-China politicians in Singapore. Since when does a Southeast Asian nation have the right to stick its nose in where it is not wanted
The Chinese Communist Party (CCP) has released a plan to economically integrate China’s Fujian Province with Taiwan’s Kinmen County, outlining a cross-strait development project based on six major themes and 21 measures. This official document by the CCP is directed toward Taiwan’s three outlying island counties: Penghu County, Lienchiang County (Matsu) and Kinmen County. The plan sets out to construct a cohabiting sphere between Kinmen and the nearby Chinese city of Xiamen, as well as between Matsu and Fuzhou. It also aims to bring together Minnanese cultural areas including Taiwan’s Penghu and China’s cities of Quanzhou and Zhangzhou for further integrated
During a recent visit to Taiwan, I encountered repeated questions about “America skepticism” among the body politic. The basic premise of the “America skepticism” theory is that Taiwan people should view the United States as an unreliable, self-interested actor who is using Taiwan for its own purposes. According to this theory, America will abandon Taiwan when its interests are advanced by doing so. At one level, such skepticism is a sign of a healthy, well-functioning democratic society that protects the right for vigorous political debate. Indeed, around the world, the people of Taiwan are far from alone in debating America’s reliability
As China’s economy was meant to drive global economic growth this year, its dramatic slowdown is sounding alarm bells across the world, with economists and experts criticizing Chinese President Xi Jinping (習近平) for his unwillingness or inability to respond to the nation’s myriad mounting crises. The Wall Street Journal reported that investors have been calling on Beijing to take bolder steps to boost output — especially by promoting consumer spending — but Xi has deep-rooted philosophical objections to Western-style consumption-driven growth, seeing it as wasteful and at odds with his goal of making China a world-leading industrial and technological powerhouse, and