Description: The Chinese government has allegedly considered easing the recently imposed export controls of its rare earth minerals to Europe. China tightened the exports of rare earth minerals as a response to Trump’s tariffs in April on a global level, stating that countries would have to obtain special exports licenses in order to be eligible for favorable trade terms. Chinese media sources reported that the potential policy shift was discussed by China’s Ministry of Commerce and involved more than 40 Chinese and European semiconductor firms. The information follows a previous report that European companies have started to backtrack investments on the Chinese market and cut costs due to the stagnant Chinese economy and the strict trading and economic conditions.
Impact: China, as the most dominant country on the rare earth minerals market, is looking at losing a significant potential partner in the EU if it doesn’t scale back its strict export policies. Trump’s tariffs have significantly closed the gap between Europe and China in recent months, as Chinese companies are staging a comeback on the European markets while Europe slightly leans towards the expanded potential of the Chinese export economy. Rare earths are paramount for industry development as most tech – based industries such as aerospace, telecom, automotive, as Europe is slowly bridging away from US economic dependence with China emerging as the most likely partner. Immediate strategic partnership between the bloc of countries and the second largest global economy is unlikely in the short to mid – term, however, global economic instability coupled with the demonstrated unreliability by the US might result in a unlikely close cooperation in several key industries between Europe and China on the long – term.