China’s Commerce Ministry Defends Rare-Earth Export Controls as Lawful
China's Ministry of Commerce (MOFCOM) clarified that its new rare-earth export controls are national-security measures, not outright bans. Licenses will be issued for qualified civilian trade, emphasizing the military significance of medium- and heavy rare earths. China leads global rare-earth production with 70% output and 90% processing, so any licensing changes could significantly impact supply chains.
- The recent action aims to refine China's export control system, aligning with domestic law and non-proliferation commitments.
- Implementation focuses on licensing rather than prohibition; licenses will be granted if applications meet criteria.
- China is considering facilitation measures like general licenses to encourage legitimate trade.
- China expects minimal broader supply-chain impact and assures compliant civilian exports can receive approval.
Response to U.S. Trade Measures
- MOFCOM addressed U.S. tariff proposals and potential controls on critical software, criticizing what it sees as a double standard.
- China urges dialogue to manage trade differences but is prepared to defend its interests if necessary.
- MOFCOM criticized upcoming U.S. port fees on Chinese-linked vessels, calling them inconsistent with WTO rules.
- As a countermeasure, China plans special port fees on U.S.-linked vessels to protect its companies and ensure fair competition.
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