WASHINGTON (CP) – The Trump administration is dealing with growing worldwide concerns as China continues blocking exports of important minerals needed to make cars, phones, and military equipment, with global automakers warning that production could stop completely without a quick solution to the trade dispute.
China decided in April to stop sending out rare earth metals and special magnets that companies around the world need to build their products. This move has caused major problems for car makers, airplane builders, computer chip companies, and military contractors who depend on these materials from China. The decision shows how much control China has over these important resources and appears to be China’s way of gaining power in the ongoing trade war with President Trump.
President Trump has been working to change America’s trading relationship with China by putting high taxes on Chinese goods coming into the USA. Trump wants to reduce the amount of money America owes China and bring manufacturing jobs back to American workers. China responded by putting its own taxes on American goods and is now using its control over important materials to pressure the Trump administration to back down.
The White House announced that Trump and Chinese President Xi Jinping are expected to talk this week, with China’s export ban likely to be a major topic of discussion. White House spokeswoman Karoline Leavitt told reporters that the administration is actively watching China’s compliance with international trade agreements and continues to communicate with Chinese officials about resolving the situation.
German car makers became the latest to warn that China’s restrictions could shut down their production and hurt their local economies. Hildegard Mueller, head of Germany’s auto industry group, said that production delays and even complete shutdowns cannot be ruled out if the situation does not change quickly. Similar complaints have come from Indian electric vehicle makers and major automakers including General Motors, Toyota, Volkswagen, and Hyundai.
The situation highlights America’s dependence on China for critical materials needed for both civilian and military products. The Trump administration is now working to find alternative sources and increase domestic production of these important minerals. However, experts warn that developing new supply chains and production facilities could take years to complete, making short-term solutions with China necessary to prevent major disruptions to American manufacturing.