CRS – Chinas Rare Earth Industry and Export Regime: Economic and Trade Implications for the United States, Wayne M. Morrison, Specialist in Asian Trade and Finance and Rachel Tang, Analyst in Asian Affairs, April 30, 2012
“Chinas position as the worlds dominant producer and supplier of rare earths (97% of total output) and its policies to limit exports have raised concerns among many in Congress, especially given the importance of rare earths to a variety of U.S. commercial industries (e.g., hybrid and conventional autos, oil and gas, energy-efficient lighting, advanced electronics, chemicals, and medical equipment), as well as to U.S. defense industries that produce various weapon systems. Many are concerned that rising rare earth prices could undermine the global competitiveness of many U.S. firms (lowering their production and employment), impede technological innovation, and raise prices for U.S. consumers. Others are concerned that Chinas virtual monopoly over rare earths could be used as leverage against major rare earth importers, such as the United States, Japan, and the European Union (EU).”
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