South Korea caught in the crossfire of China-US rare earth dispute
The Chinese authorities have urged South Korean companies to cease exporting products containing Chinese rare earth metals to American defence firms, according to Reuters, which cited local media. Authorities in Seoul are verifying these reports, while Beijing has not provided any comment.
The issue was brought to light on Tuesday by the South Korean newspaper Korea Economic Daily, which cited government and corporate sources. Initially, it was mentioned that the Chinese Ministry of Commerce had warned South Korean companies about potential sanctions for breaching export restrictions. This was later corrected to refer to "the Chinese government."
South Korea's Ministry of Industry confirmed that it is verifying the reports with the Chinese authorities and local companies. So far, there has been no official confirmation that South Korean entities have received letters from the Chinese government. The Chinese Ministry of Commerce has not responded to requests for comment.
In early April, China implemented restrictions on the export of rare earth metals, requiring exporters to obtain licences as part of retaliatory actions for "reciprocal tariffs" imposed by U.S. President Donald Trump. Imports from China to the U.S. are subject to a 145% tariff, while China imposes a 125% tariff on imports from the United States.
Additionally, as Reuters notes, authorities in Beijing have cautioned the governments of other countries against forming broad economic agreements with the U.S. at China's expense.
Meetings between representatives of South Korean and U.S. authorities regarding tariffs are scheduled for Thursday in Washington, DC, at 10:00 GMT.
17 elements the world "fights" over
Rare earth metals consist of 17 elements crucial for the production of many modern technologies: from hybrid vehicles to weaponry.
South Korea possesses some resources of these elements, but the extent of the deposits is uncertain – according to Reuters. China, however, still accounts for over 80% of the global refining of rare earth metals.
