China is ramping up its control over rare earth metals by introducing new measures aimed at protecting the industry from information leaks.
Government Requests for Employees
China's Ministry of Commerce has recently ordered rare earth companies to submit detailed lists of employees with specialized knowledge. In some cases, the government is requiring these employees to surrender their passports. This initiative is aimed at creating a national registry of individuals with rare-earth knowledge to prevent unauthorized disclosure of trade secrets.
Global Trade Tensions
Months ago, China rolled out a new licensing system for rare earth and rare-earth magnet exports, which has disrupted global supply chains and raised concerns among Western manufacturers. Some companies in the U.S. and Europe have reported slowdowns and temporary shutdowns due to difficulties in sourcing materials.
China's Dominance in the Rare Earth Sector
China currently dominates the global rare earths market, producing roughly 90% of the world’s rare-earth magnets. This gives the country significant leverage in the high-tech and defense sectors, raising concerns in Beijing over foreign espionage and economic sabotage.
The tightening control over the rare earth industry is leading to increased tensions in global trade, while China continues to dominate the production of high-performance components.
