EU Officials Push for Tougher Response Against Chinese Rare Earth Export Controls
EU ministers and Parliament members this week urged the bloc to respond forcefully to China’s rare earth export restrictions if Beijing doesn’t repeal them or swiftly grant export licenses to European companies. Some also said they’re skeptical Beijing’s one-year suspension for some of its export controls will last.
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“We now have a stop-the-clock period of 12 months -- given agreements between the U.S. and China -- but I'm not sure that, in fact, gives us 12 months,” Stephane Sejourne, the European Commission’s industrial strategy chief, said during a Parliament debate about the Chinese measures. “It is probably temporary. Trump will change his game. And so it is crucial that we reduce dependence.”
As part of a trade agreement with the U.S., China earlier this year agreed to a one-year suspension for new regulations that were set to impose export license requirements over the foreign trade of items that contain Chinese-origin rare earths (see 2511050064 and 2510300024). At the time, the EU said it was unclear whether the suspension applied to all countries or just the U.S. (see 2511040026).
Sejourne, speaking through a translator, suggested EU companies also will benefit from the one-year suspension, but he said European firms are still facing restrictions on other imports of Chinese rare earths, including controls introduced by China in April that cut off rare earth magnets to defense contractors and limited the amount commercial companies can buy.
The bloc was hoping to secure export licenses or exemptions for those controls, Sejourne said, and he noted that Maros Sefcovic, the EU commissioner for trade and economic security, has been able to push Beijing to “speed through those export licenses which had been blocked.” But other licenses are being “restricted” and “only granted in a very limited fashion.”
He added that “entire [European] industrial sectors are being put under pressure, particularly when it comes to the automotive industry and energy, [while] other sectors are simply excluded, such as defense.”
“We must ensure that Europe is not just a collateral victim of geopolitical ruckuses between the U.S. and China,” Sejourne said. “We are actually directly targeted.”
Marie Bjerre, Denmark’s minister of European Affairs, speaking on behalf of the Council of the EU, said China’s rare earth controls “lack clear justifications.” Like Sejourne, she noted that even though China has suspended some of its restrictions, others remain and are “having a negative effect on global supply chains.” She said the EU shouldn’t hesitate to use measures like its anti-coercion instrument, which allows the EU to impose countermeasures -- such as export controls and tariffs -- against countries in response to measures that it deems qualify as economic coercion (see 2303280024).
“We are not naive,” Bjerre said. “In the face of today's realities, we are not afraid to use instruments at our disposal to tackle unfair competition, level the playing field, enhance our economic security and protect our economy.”
Kathleen van Brempt, a Parliament member from Belgium, said China’s pause in certain controls “might be reassuring, but it's not enough.” She said the EU needs a bigger voice in ongoing trade talks between the U.S. and China, and it shouldn’t allow those two nations to strike deals that affect the supply chains of European companies.
“China and the U.S. both are making decisions that shape our economy, and we're standing on the sideline and have little impact on what's happening next,” van Brempt said. “We need to step up our efforts. It's high time that we take back control of our own economic security.”
The EU should work with other countries to push back against China’s controls, “and we should not hesitate to go to the [World Trade Organization] or to use the anti-coercion instrument,” she said.
Sejourne said the EU can impose new trade restrictions against China, and EU governments can introduce incentives for firms to diversify their supply chains, but those measures “will only work if European businesses play along, and if they fully integrate secure economic security matters in their business logic.
“This will only work if European businesses stop buying solely Chinese raw materials,” he said. “We have a collective responsibility.”