Keith Bradsher

Rare earths are very important these days.

They are used all over the economy, whether it's cars, computer chips, fighter jets, missiles.

China controls the materials, rare earth metals, for making them anywhere in the world.

And it has put already in April some export controls on supplying those materials.

And on October 9th, China said, we're going to put a lot more restrictions on these.

China is expanding its restrictions on rare earths exports.

The new rules do three things.

One, they prevent the West from being able to build its own mines and refineries and magnet factories, or at least they make it much more difficult for the West to do that.

So no more using any Chinese patents without permission.

No more buying equipment from China to do any of this.

And China makes almost all the equipment for mining and refining rare earths or making magnets.

Second, the new rules put restrictions on what you are allowed to move across any country's borders if it has Chinese magnets and rare earths inside it.

And third, China is saying for the first time that it's going to restrict even more kinds of rare earths than it did the first time around last April.

And so this will affect even more military production, for example, making it hard for Europe to build weapons systems for Ukraine or for Europe to protect itself against Russia.

And that's why Treasury Secretary Scott Besant said that these new rules are a bazooka aimed at the entire world's supply chains.

The United States has done this with the fastest semiconductors.

So about the top three to five percent of the world's semiconductors do have these very restrictive rules from the United States that do track what downstream products they are later built into.

What is new and different about China's rules is that China is putting the restrictions on a raw material.

And then saying that products that are later manufactured from that raw material are also restricted.

So in a way, this is a combination of the U.S.