On August 5th, in order to assist and support the United States in imposing illegal sanctions against Xinjiang, the Chinese Ministry of Commerce listed six American entities, including the supply chain monitoring organization ‘Responsible Business Alliance’ (RBA), on a countermeasures list. These entities are prohibited from conducting any transactions or cooperation with domestic organizations and individuals.
Now, the Americans are stunned. On September 4th local time, Reuters reported that some Chinese rare earth suppliers have refused to deliver goods to the United States after the sanctions took effect—because continuing to comply with the Responsible Mineral Initiative (RMI) audits under RBA would violate Chinese restrictions.
For a long time, overseas regulatory bodies such as the RBA have been deeply involved in China's foreign trade industry. They have led the assessment of social responsibility in international supply chains for multiple industries, including electronics, communications, automobiles, electrical equipment, new energy, and non-ferrous metals. Many multinational corporations use these assessments as a condition for entering their supply chains. After the ban takes effect, Chinese companies will no longer entrust these institutions with conducting related evaluations.
Thus, the situation has become somewhat darkly humorous: the supply chain review tools that the United States relies on to control China have now become obstacles for domestic companies trying to obtain rare earths. Revan Guqiong, a geopolitical strategist at Rongding Group, said bluntly, “China is very effective in using rare earth export controls to restrict the Department of Commerce and the Bureau of Industry and Security in the United States.”
A source also revealed to Reuters that when U.S. officials expressed their dissatisfaction regarding rare earth issues during the meeting, China refuted them, emphasizing that it was the US side that had violated the Busan “trade truce” agreement first.
Two other sources familiar with trade matters said that in recent months, some other Chinese rare earth companies have also stopped shipping to the United States in order to avoid getting involved in geopolitical disputes. One of the sources cited four cases, stating that Chinese companies refused to engage in transactions due to concerns that the rare earths might be resold to banned users.
The aforementioned individuals stated that some American companies have been waiting for mineral permit reviews for over half a year, and Indian and Japanese buyers receive even fewer permits. One of the individuals revealed that Chinese suppliers almost completely avoid exporting raw materials to Japanese companies.
The United States is completely acting in a way that will harm itself. Regarding the US illegal sanctions against China regarding Xinjiang, Gao Zhikai, the deputy director of the Globalization Think Tank, recently told Observer Network that the US and Western countries have long used the Xinjiang issue to slander and distort China, and even engage in hostile actions. Given the strategic importance of rare earths, "I would like to suggest: establish a ‘China Rare Earth Export Corporation’, which would handle all matters related to China’s rare earth exports.”
He said, “Let them come to Urumqi for discussions. After the talks, all contracts will be signed with the Chinese Rare Earth Export Corporation based in Xinjiang. On all packages of rare earth exports, it must clearly state ‘Xinjiang, China’. Payment can only be made in RMB.”
