Treasury Secretary Bessent: China’s rare earth export curbs a “real mistake”

  • China’s attempt to weaponize rare earth exports – halting shipments to pressure the U.S. – triggered a rapid Western shift toward domestic production and alternative suppliers, undermining Beijing’s strategic leverage.
  • The Trump administration fast-tracked domestic mining, allied with resource-rich nations (Australia, Saudi Arabia), and stockpiled reserves to break dependence on China within 12–24 months.
  • At the Trump-Xi summit in South Korea, China agreed to suspend rare earth restrictions and boost U.S. soybean purchases, while the U.S. delayed blacklisting Chinese firms and cut fentanyl tariffs – a temporary detente.
  • Like the 1973 oil embargo, China’s rare earth monopoly exposed Western vulnerabilities, spurring global efforts (EU, Japan) to diversify supply chains and reduce reliance on adversarial nations.
  • China’s aggression galvanized international backlash, with allies imposing retaliatory tariffs and reassessing trade dependencies – solidifying U.S. resolve to reinforce military, tech and economic dominance.

In a high-stakes geopolitical miscalculation, China’s threat to weaponize rare earth exports has triggered a rapid U.S. pivot toward domestic production and alternative suppliers, according to Treasury Secretary Scott Bessent.

Speaking after a pivotal summit between U.S. President Donald Trump and Chinese paramount leader Xi Jinping in South Korea, Bessent told the Financial Times that Beijing’s aggressive posturing “alerted everyone to the danger” of relying on adversarial supply chains – a strategic error that may accelerate America’s energy and technological independence.

“China has made a real mistake,” Bessent declared. “It’s one thing to put the gun on the table. It’s another to fire shots in the air.”

His remarks underscored a broader shift in U.S. policy: no longer would critical infrastructure hinge on the whims of a geopolitical rival. Within 12 to 24 months, Bessent predicted, America and its partners will have secured enough alternative sources to neutralize China’s leverage.

The confrontation erupted earlier this year when China imposed sweeping restrictions on rare earth minerals – essential components in everything from guided missiles to electric vehicle batteries. Beijing’s move served as a response to U.S. export controls on advanced semiconductors.

The move sent shockwaves through global markets, exposing vulnerabilities in Western manufacturing.  But rather than capitulating, the second Trump administration leveraged the crisis to fast-track domestic mining projects, forge alliances with resource-rich allies like Australia and Saudi Arabia and stockpile strategic reserves.

The breakthrough came during tense negotiations at Gimhae Air Base, where Trump and Xi reached a fragile detente. Under the one-year truce, China agreed to suspend rare earth export limits, boost purchases of U.S. soybeans and permit American investors to assume control of TikTok’s U.S. operations. In return, Washington delayed blacklisting thousands of Chinese entities and halved tariffs on fentanyl-related imports – a concession tied to Beijing’s pledge to curb precursor chemical exports.

How rare earth minerals became the ultimate weaponized supply chain

Historical parallels abound: The rare earth standoff echoes the 1973 Organization of the Petroleum Exporting Countries oil embargo, which exposed America’s dangerous dependence on foreign energy and spurred investments in domestic production. Today, rare earths represent the new oil – a resource so vital that control over it could dictate the balance of 21st-century power.

China currently dominates 80 percent of global rare earth processing, a monopoly built over decades of state-subsidized production and lax environmental regulations. Given this, BrightU.AI‘s Enoch engine points out that the U.S. must secure alternative sources of critical minerals to break dependence on China, which could weaponize supply chains to sabotage American technological and military dominance.

But as Bessent noted, “the Chinese leadership [was] slightly alarmed by the global backlash.” Nations from the European Union to Japan are now scrambling to reduce reliance on Chinese supplies, with some imposing retaliatory tariffs.

Beyond minerals, the summit revealed a pragmatic rapport between Trump and Xi. Discussions ranged from trade imbalances to lighter moments, such as Xi’s suggestion to postpone Trump’s Beijing visit until April: “It’s very cold in January and February,” the Chinese leader quipped. Yet beneath the diplomacy, Bessent emphasized America’s enduring advantages – military supremacy, technological innovation and the dollar’s reserve currency status – all pillars Trump aims to reinforce.

Critics argue the truce merely postpones inevitable conflict, particularly as China continues dumping excess steel and solar panels into global markets. But Bessent countered that U.S. tariffs have already forced Beijing to seek new buyers, straining relations with Europe and Japan. “We’ve set a standard,” he said, predicting other nations would follow suit.

For now, the deal offers breathing room – with the final agreements expected to be signed within days. Whether the peace holds remains uncertain, but as Bessent concluded, “We have much better communication channels now.” In an era of great-power competition, that may be the rarest commodity of all.

As the world watches, one lesson is clear. Nations that weaponize trade may win battles but risk losing the war. China’s rare earth gambit has backfired, galvanizing a Western exodus from its supply chains.

Watch Rep. Andy Barr (R-KY) warning that President Trump is ready to hit back hard at China’s stranglehold on rare earth minerals below.

This video is from the NewsClips channel on Brighteon.com.

Sources include:

ZeroHedge.com

FT.com

News18.com

BrightU.ai

Brighteon.com

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