• Nazak Nikakhtar, a former Department of Commerce official, warned about the U.S.’s heavy reliance on China for industrial diamonds, emphasizing the need for urgent action to address supply chain vulnerabilities.
• China produces 95 percent of the world’s synthetic diamonds, and the U.S. imports 80-95 percent of its industrial diamond needs, highlighting the severe economic consequences of this dependency.
• China banned the export of industrial diamonds to the U.S., along with other critical materials, in response to U.S. export controls on advanced semiconductor equipment and software.
• To mitigate vulnerability, the U.S. must prioritize domestic production, invest in research and development, and explore alternative supply chains, according to Nikakhtar.
• Addressing this issue is crucial for protecting U.S. economic security and long-term interests, as continued dependency on China poses significant risks.

In a recent interview with EpochTV’s “American Thought Leaders,” Nazak Nikakhtar, a former Department of Commerce official under the first administration of President Donald Trump, issued a warning to the American public and government officials. She emphasized the urgent need to address the United States’ heavy reliance on China for industrial diamonds, a dependency that could have severe economic consequences.

“We are running out of time. We really need to race to solve this,” Nikakhtar said, stressing the long-standing issue of U.S. supply chain vulnerability. According to her, the problem has been exacerbated by China’s deliberate strategic actions over the past two decades, including unfair trade practices that have allowed Beijing to dominate industries and control supply chains.

China’s dominance in industrial diamond production is a case in point. These diamonds, often referred to as “super hard materials,” are essential for cutting tools in various industries including automotive, aerospace and defense. In 2023, the U.S. Geological Survey (USGS) reported that China produces 95 percent of the world’s synthetic diamonds, and the U.S. imports between 80 and 95 percent of its industrial diamond needs.

Recent export controls and their impact

The urgency of the situation was underscored on Dec. 3, when China banned the export of industrial diamonds to the United States, along with other critical materials such as gallium, germanium and antimony. This move came just a day after the U.S. added advanced semiconductor manufacturing equipment and software to its export controls, effectively curbing China’s access to these technologies.

The ban on industrial diamonds is particularly concerning because these materials are classified under “Made in China 2025,” the Chinese government’s strategic plan to achieve dominance in advanced manufacturing. Since 2012, Beijing has provided substantial subsidies to companies involved in diamond production, further cementing its control over the industry.

For decades, the U.S. Congress has granted the president extensive authority to set tariff rates and use them to protect national security interests. In 2018, during Trump’s first administration, Section 232 of the Trade Expansion Act of 1962 was invoked to impose tariffs on steel and aluminum imports, a move that aimed to address the U.S.’s reliance on foreign sources for these critical materials. (Related: U.S. secures drone supply chain as China’s dominance of commercial drone market threatens NATIONAL SECURITY.)

While these measures have shown some effectiveness, they also highlight the complexity of the issue. The U.S. lacks a stockpile of industrial diamonds, with domestic production meeting only 16 percent of the nation’s needs in 2023. Nikakhtar emphasized that the U.S. must act now to mitigate this vulnerability.

According to Nikakhtar, the new administration is confident in its approach to leveraging existing legal mechanisms to address unfair trade practices. However, she stressed the need for a more comprehensive strategy.

“Imagine a U.S. economy with zero manufacturing,” she warned, underscoring the potential consequences of continued dependency on China.

To address this issue, the U.S. must prioritize domestic production, invest in research and development, and explore alternative supply chains. Nikakhtar believes the time to act is now before China’s export controls cause significant economic damage.

The urgent call to address U.S. dependence on China’s industrial diamonds highlights the broader challenges facing the nation’s supply chains. As Beijing continues to assert its dominance in critical industries, the U.S. must take decisive action to protect its economic security and long-term interests. The coming years will be crucial in determining whether the nation can break free from its reliance on China and secure a more resilient future.

Watch the video below that talks about what Trump should focus on to counter China.

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

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Sources include:

ZeroHedge.com

TheEpochTimes.com

Brighteon.com