China 'Made A Real Mistake' With Rare Earth Threats: Bessent

Treasury Secretary Scott Bessent stated that China made a significant error by threatening to restrict rare earth mineral exports. This action has prompted the United States and its allies to accelerate efforts to find alternative sources within two years. Bessent explained that China's move has alerted the world to the potential for using critical minerals as leverage. In early October, China implemented new controls on technologies and materials related to rare earth elements. Following discussions between President Trump and Xi Jinping, China announced a one-year suspension of these restrictions. Bessent believes this suspension is a result of a global backlash to China's export controls. He indicated an agreement exists for near-term stability in relations, with Beijing's influence in critical minerals expected to diminish. The suspension of China's controls also extends to the European Union. Historically, China has dominated global rare earth production and processing. In response to Chinese restrictions, the U.S. has been working to incentivize domestic production of rare earth magnets. President Trump's administration has focused on increasing domestic production of strategic materials and diversifying supply chains away from China. Bessent emphasized that the U.S. has its own leverage and is prioritizing working with allies to de-risk supply chains. The Treasury Secretary suggested that a complete decoupling might be necessary if China continues to be an unreliable partner.