Barrons’ panel discusses the importance of rare earths and magnets, as well as China’s monopoly on the industry.
President Donald Trump said Friday that the United States is considering imposing a “massive” tariff hike on China, amid an ongoing trade dispute between the two countries.
Trump wrote in a post on his Truth Social platform that China is telling other countries it wants to impose export controls on rare earth minerals, which are critical components for advanced technologies ranging from semiconductors to smartphones.
“Very strange things are happening in China! They are becoming very hostile and sending letters to countries around the world imposing export controls on every item of production related to rare earths, and virtually everything they can think of, even if it is not made in China,” the president wrote.
“No one has ever seen anything like this, but in essence it would ‘clog up’ the markets and make life difficult for virtually every country in the world, especially China,” Trump said. “We have been contacted by other countries who are extremely angry about this great trade hostility coming out of nowhere.”
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President Trump criticized China’s decision to impose export controls on rare earths. (Getty Images/Getty Images)
In response to China’s decision to impose controls on rare earth exports, Trump said he would be forced to “financially counter this decision.”
“One of the policies we are currently considering is a massive increase in tariffs on Chinese products entering the United States of America,” he explained. “Many other countermeasures are also being seriously considered.”
Trump said relations between the United States and China had been “very good” over the past six months, making the Chinese government’s decision “even more surprising.”
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China is one of the world’s leading suppliers of rare earths. (FLORENCE LO/PISCINE/AFP via Getty Images)
He added that he felt China was “waiting, and now, as usual, I was proven right!”
“There is no way that China will be allowed to hold the world ‘captive,’ but that appears to have been its plan for some time, starting with the ‘Magnets’ and other elements that it has quietly assembled into a monopoly position, a move that is sinister and hostile to say the least,” Trump continued.
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Trump said he was considering “massive tariffs” on Chinese goods in response to Xi’s decision on rare earths. (Kevin Lamarque/File Photo)
“But the United States also has monopoly positions, much stronger and more far-reaching than China’s. I simply have not chosen to use them, never had a reason to – UNTIL NOW! The letter they sent is several pages long and details, in great detail, every item they want to hide from other nations. Things that used to be routine are no longer routine at all,” Trump wrote.
“For every one thing they’ve been able to monopolize, we’ve got two. I never thought we’d get to this point, but maybe, like all things, the time is now,” Trump said, noting that while it could be “potentially painful,” it would ultimately be “a very good thing, ultimately, for the United States.”
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Trump also said he planned to meet with Chinese President Xi Jinping in two weeks at the APEC summit in South Korea – but that after China’s decision, “there seems to be no reason to do so.”
