Unearthing China’s Rare Earths Strategy

Abstract

Relations between China and the West have been difficult for some time.Recently, however, one issue in particular has made the headlines: rare earths. Vital for the production of low-carbon products such as hybrid cars and wind turbines, consumer goods and sensitive military hardware like cruise missiles and smart bombs, rare earths are indispensable for high-tech industries and emerging technologies.With China responsible for the production of almost 97% of these rare earth elements (REE), recent Chinese reductions in exports, coupled with increasing export taxes, are causing jitters not only in the markets but also politically.Roderick Kefferputz, Associate Research Fellow at CEPS, takes a look at China’s long march towards dominance of this all-important market and, ahead of the European Commission’s publication of its Raw Materials Strategy, considers options for the future.