Customs War: China limits Rare Earth - what does that mean for Germany?

Customs War: China limits Rare Earth - what does that mean for Germany?

Bayan Obo, Innere Mongolei, China - The tensions in the trade conflict between the USA and China intensify. The United States continues to rely on a strategy of increased tariffs to put pressure on China. At the same time, the Chinese authorities took rapid countermeasures. The latest steps include tightened export controls for rare earths that are of central importance for numerous high technologies. China, which produces about 70% of the rare earths, which is reduced worldwide, has a factual monopoly in some areas, which significantly influences the geopolitical balance of power. Dealers report on an increase in orders from the USA, but this is accompanied by concerns about possible losses in sales based on customs policy. In addition, the Institute for the World Economy in Kiel estimates that the US economy could decrease by 1.6% should last longer.

In the inner Mongolia, Bayan Obo, one of the largest mining areas for rare earths. Germany is also affected because it imported around two thirds of its rare earths from China last year. Against the background of these national interests, the United States and China have made a preliminary agreement in May: the tariffs on US goods to China were reduced to 10% and Chinese goods to the USA for 90 days. The negotiations between the two nations are scheduled until mid -August.

technological race

A central point of dispute in the trade conflict is the regulation of high technology chips. The United States is trying to cut China from the latest semiconductors, which further restricts access to critical technologies. These political measures reflect a dedicated interest in ensuring technological dominance in the global economy, which further tightens the financial and strategic tensions between the two countries.

geopolitical implications

The negotiations on the sidelines of the conflict could be strengthened by China's influence on Russia in the Ukraine conflict. Wang Huiyao, founder of a think tank, indicates that China could possibly appear as an intermediary, which underlines the country's negotiating skills in a geopolitically delicate environment. Both the United States and China are faced with the challenge of reconciling national interests with international relationships, while at the same time they have to keep an eye on the economic effects of their measures.

The trade conflict between the two nations therefore remains not only an economic, but also a geopolitical area of ​​tension that could have far -reaching consequences for the global economy. While traders of the international markets observe changes and adapt to changed framework conditions, it remains to be seen how the situation will develop until August. In any case, it turns out that the dynamics of the global economy are increasingly shaped by political decisions that go beyond short -term trade.