WASHINGTON:
The alarm on China’s strangulation in critical minerals increased on Tuesday, as global automakers joined their US counterparts to protest that China’s restrictions on exports of rare earths, mixes and magnets could not be exported.
German automakers have become the latter to warn that China’s export restrictions threaten to close production and hit their local economies after a similar complaint from an Indian EV manufacturer last week.
China’s decision in April to suspend the exports of a wide range of critical minerals and magnets has increased the supply chains that are central to automakers, aerospace manufacturers, semiconductor companies and military contractors around the world.
The move highlights China’s sovereignty in the critical mineral industry and is regarded as leverage by China in its ongoing trade war with US President Donald Trump.
Magnets’ missions necessary for the assembly of all cars and aircraft to robots and rockets, have stopped in many Chinese ports, while the Chinese government is planning a new regulatory system.
Once implemented, the new system could permanently prevent supplies from reaching some companies, including US military contractors. The suspension caused stress in the meeting rooms and the capitals of the nations – from Tokyo to Washington – as officials were confused to identify limited alternatives amid fears that the production of new cars and other objects could grind until the end.
“If the situation does not change quickly, production delays and even production holidays can no longer be ruled out,” said Hildegard Mueller, head of Germany’s Auto Lobby, in Reuters on Tuesday.
Diplomats, automakers and other executives from India, Japan and Europe were urgently searching for meetings with Beijing officials to promote faster approval of exports of rare earth magnets, according to sources in Reuters, as the lack of lack of lack.
A business delegation from Japan will visit Beijing in early June to respond to the Ministry of Commerce on curbs and European diplomats from countries with large automakers have also sought “emergency” meetings with Chinese officials in recent weeks. Reuters
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