China mimics US tactics with new rare earth export controls | AP News
China has long accused the United States of stretching its influence beyond borders to control how foreign firms trade. This month, Beijing has taken a page from Washington’s own rulebook.
In a move aimed at countering U.S. restrictions, China announced that foreign companies must now seek government approval to export products containing even trace amounts of rare earth materials mined or processed with Chinese technology.
Jamieson Greer, the U.S. Trade Representative, said the new rule gives China sweeping power over the global technology supply chain. “A South Korean phone maker will now need Beijing’s permission to sell its devices to Australia if the phones include any China-sourced materials,” he explained.
Trade analysts say China’s move mirrors America’s long-standing foreign direct product rule, which lets Washington control foreign-made goods that rely on U.S. technology. The same rule has been used to block China’s access to high-end chips and semiconductors built overseas.
Neil Thomas, a researcher at the Asia Society Policy Institute, said Beijing is “learning from the best.” He added that China is copying U.S. tactics because it saw how effective American export controls were in slowing China’s own technology growth.
A Policy Built Over Years
China began shaping its counter-strategy in 2018, when Donald Trump started the trade war. The Ministry of Commerce later created the Unreliable Entity List in 2020, modeled after the U.S. Commerce Department’s blacklist. That list prevents certain companies from doing business with China.
In 2021, Beijing went further by enacting an anti-foreign sanction law. It allows authorities to freeze assets, deny visas, and block deals with foreign individuals or firms that act against Chinese interests. The state news agency at the time quoted ancient Chinese wisdom, saying China would “hit back with the enemy’s own methods.”
Legal experts say Beijing studied U.S. law closely. Li Qingming, a scholar cited in a Chinese news report, said the legislation reflects both international law and principles of fairness. He claimed the law could help deter foreign governments from raising new sanctions.
Trade War Intensifies Under Trump’s Return
When Donald Trump returned to the White House earlier this year, the conflict reignited. His administration began a new round of tariffs, starting with a 10% duty on Chinese goods in February over fentanyl concerns.
China responded swiftly. It placed PVH Group, the owner of Calvin Klein and Tommy Hilfiger, and Illumina, a U.S. biotechnology firm, on its unreliable entity list. These companies were barred from trade or new investment inside China.
Beijing also limited exports of tungsten, tellurium, bismuth, molybdenum, and indium— metals used in everything from electric cars to smartphones.
A month later, China expanded its list again after another U.S. tariff hike, targeting American defense firms such as General Dynamics Land Systems and General Atomics Aeronautical Systems. It accused them of “endangering China’s national security.”
In April, Trump’s “Liberation Day” tariffs raised duties to 125%. Beijing matched the rate and blacklisted more American companies while tightening control over rare-earth exports. The move caused disruptions in shipments of magnets used in jet engines, electric vehicles, and missiles.
The Risk of Escalation
Jeremy Daum of Yale Law School said both countries now use “very parallel tools” in their trade and security policies. Each claims to act in defense of national interests, but their measures often deepen economic divides.
“The danger,” Daum warned, “is that what one side views as fair retaliation, the other sees as provocation. In a race to the bottom, no one wins.”
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