China Rare Earth Weaponization
2025 Apr 9Beijing Turns Minerals into Leverage
In response to Liberation Day tariffs, China escalated restrictions on critical minerals — gallium, germanium, antimony, rare earth processing essential to semiconductors and defense. China controls 60% of mining and 90% of processing capacity.
Beijing imposed licensing and end-use restrictions creating uncertainty without WTO violations. Switching suppliers requires 5-10 years and billions in investment. The U.S. depends on Chinese rare earths for F-35 components, precision-guided munitions, and EV motors.
China's mineral leverage inverted power dynamics: instead of Western financial sanctions, a non-Western power uses resource control as coercion. Can the West build independent supply chains before the next crisis? This is the defining industrial policy challenge of the decade.