Following U.S. Treasury Secretary Janet Benson’s complaint about China “withholding” approved rare earth exports, Bloomberg reported on June 2 that Michael Hart, president of the American Chamber of Commerce in China (AmCham China), clarified that China is not preventing rare earth exports—though approval processes are moving slower than anticipated.
“We are seeing some approvals coming through, though certainly slower than the industry expected,” Hart emphasized. “Part of the delay relates to China’s implementation of a new export approval system, not an intentional blockage.”
Secretary Benson made her claims during a June 1 interview with CBS, alleging China was “withholding” previously agreed rare earth exports. This came a day after former President Donald Trump asserted on Truth Social that “China has completely violated our agreement.”
The issue of critical mineral exports has become a flashpoint in U.S.-China relations. In mid-May, as part of trade de-escalation measures, China temporarily suspended export restrictions on 28 U.S. entities, which may include some rare earth producers.
Regulatory Context and Temporary Suspension
Under China’s export control laws, the Ministry of Commerce announced on April 4 and April 9, 2025 (Notices No. 21 and 22) that 28 U.S. entities would be added to its export control list. However, following bilateral trade talks, China suspended these measures for 90 days starting May 14, 2025.
Exporters seeking to ship dual-use items to these entities must now apply through standard procedures under China’s Dual-Use Items Export Control Regulations. The Ministry stated it would review applications in accordance with legal requirements.
Strategic Importance of Rare Earths
According to the U.S. Geological Survey (USGS), China produces nearly 70% of the world’s rare earths—critical materials for advanced U.S. technologies ranging from fighter jets to electric vehicles. This dominance has led analysts to view rare earth controls as a potential countermeasure in trade disputes.
He Yongqian, spokesperson for China’s Ministry of Commerce, reiterated at a May 29 press briefing that export controls on dual-use items align with international norms. “As a responsible nation, China’s measures demonstrate our consistent commitment to global peace and regional stability,” he stated.
Escalating Trade Tensions
Following the Geneva trade talks, the U.S. introduced multiple discriminatory measures against China, including new AI chip export controls, bans on EDA software sales, and visa revocations for Chinese students—actions that severely undermined prior agreements.
On June 2, the Commerce Ministry spokesperson condemned these moves: “The U.S. continues unilaterally provoking trade conflicts, destabilizing bilateral relations while falsely accusing China of violating agreements. We categorically reject these baseless allegations.” The statement urged the U.S. to correct its course and honor Geneva consensus, warning that China would “take resolute countermeasures” if necessary to protect its legitimate interests.
Related topics:
- Silver Pulls Back from Seven-Month High Amid Profit-Taking and Easing Trade Tensions
- Gold Holds Steady Amid Mixed Signals, Supported by Fed Easing Bets and Geopolitical Risks
- China’s May Economic Indicators Show Mixed Performance Across Sectors
