Chapter 2 - An Overview of Chinese Rare Earth Export Restrictions and Implications

Abstract

Export restrictions on metals and mineral products have been broadly applied by many countries with a view to securing domestic supply and to address the problem of resource depletion. Export restrictions are designed to meet diverse policy objectives that range from environmental protection and increasing fiscal revenue to the development of processing sectors. The global dependency on China for raw materials particularly for rare earth elements is a contentious issue because China imposes a number of restrictions on the export of these minerals. This study takes rare earth elements as a case to evaluate Chinese export restrictions. The study evaluates China's current monopoly over the industry and provides insights into how widely traded these minerals are and China's positions in international trade in terms of both volume and value. The study investigates the various trade restrictions imposed by China and its implications including the availability of materials to Western companies.