EU–China talks to seek middle ground as US ramps pressure over rare earths

U.S. Treasury Secretary Scott Bessent

As the European Union prepares for high-stakes economic talks with China this week, the rare-earth showdown between Washington and Beijing is already casting a long shadow over Brussels. Both Reuters and Nikkei Asia report that top U.S. officials are accelerating diplomatic efforts to confront what they describe as China’s “economic coercion” in the global supply of critical minerals.

In Washington, U.S. Trade Representative Jamieson Greer told CNBC that he and Treasury Secretary Scott Bessent will travel to Malaysia today [Macau time] to meet Chinese counterparts for what he called “a difficult but necessary conversation” about Beijing’s export restrictions on rare-earth minerals. The move follows China’s sweeping new controls on the export of rare earths – essential materials used in semiconductors, EVs, and defense systems – eannounced earlier this month.

Greer said the measures violated China’s earlier pledge to maintain stable exports of strategic minerals, warning that they would “hurt the entire global high-tech economy.” He added that there was still “a good landing zone” for a balanced trade relationship, but only if Beijing reversed its protectionist course, according to Reuters yesterday.

The U.S. has responded with its own escalation. President Donald Trump’s administration announced 100% tariffs on Chinese imports set to take effect on November 1, in what analysts describe as the sharpest turn in trade policy since the early 2020s.

Despite the fiery rhetoric, Greer stressed that Washington was not seeking a full decoupling from China but rather a “rebalancing” after decades of market asymmetry. “The U.S. has always been open to China – it’s been Beijing’s overcapacity and exclusionary practices that have driven this imbalance,” he told CNBC. “We can’t live that way anymore.”

Greer also said Trump might meet President Xi Jinping next week on the sidelines of a regional economic conference in South Korea, a potential opportunity to cool tensions before they disrupt global markets further. Agricultural trade is expected to be on the agenda after Beijing halted purchases of U.S. soybeans and sorghum, moves Greer called “deliberately punitive to American farmers,” as cited by Reuters.

While Washington hardens its stance, Europe finds itself walking a finer line. Ahead of the EU–China High-Level Economic Dialogue, officials in Brussels are weighing how to support “de-risking” – the EU’s new mantra for reducing dependency on Chinese supply chains – without endorsing the U.S. policy of confrontation. Analysts say the timing of Greer and Bessent’s Asia mission is no coincidence: it signals to Beijing that Washington wants to set the tone before the Europeans arrive.

Bessent, speaking to reporters in Washington yesterday, said that “China’s export controls demonstrate the risk of dependence on Beijing.” Citing remarks at the Drake Energy Security Forum in Titusville, Pennsylvania, he urged allies to act fast to build alternative supply chains. “If China wants to be an unreliable partner to the world, then the world will have to decouple,” he said. “The world does not want to decouple. We want to de-risk. But signals like this are signs of decoupling, which we don’t believe China wants,” Nikkei Asia reported last week.

Experts at the same forum agreed that “de-risking” will be messy, slow, and expensive. Juhani Platt, a former U.S. State Department energy adviser, said China’s dominance – mining roughly 60–70% of global rare earths and refining over 90% – was built because “they were willing to do the dirty work others wouldn’t.” Processing rare earths, Platt noted, generates acidic wastewater and low-level radioactive waste, and China industrialized that activity in the 1980s and 1990s. “We’ll never be able to do it at China’s price or scale,” he said in comments to Nikkei.

Other panelists urged the U.S. to rethink its entire strategy. Brenda Shaffer of the U.S. Naval Postgraduate School argued that Washington should focus less on competing for critical minerals and more on leveraging its own energy abundance. “The U.S. is blessed with almost unlimited energy,” she said. “Instead of chasing China’s solar and wind hardware, we should double down on natural gas and fossil fuels. If they’re marathon runners, we’re sprinters – let’s act like it.”

That analogy resonated in Titusville, the birthplace of the modern oil industry. Kevin Book, managing director at ClearView Energy Partners, said America’s energy transformation has been “dramatic and incredible,” noting that eight of every ten barrels added to global supply in the past 15 years came from the U.S. “We went from importing 25% of our energy to exporting 10%,” he said, giving Washington new leverage as global energy demand surges with artificial intelligence’s power needs.

William Polen of the U.S. Energy Association added that AI could double global electricity demand by 2030, “essentially adding a Japan-sized load to the world grid.” Such projections, he said, make it urgent for Western economies to secure raw materials and stable energy routes outside China.

As Brussels, Washington, and Beijing prepare to test each other’s patience in parallel meetings, one thing is clear: the global supply of rare earths – long treated as an obscure corner of the mining world – has become the new frontline of great-power politics. Times Reporter*

*With agencies