As Washington and Beijing brace for a protracted trade war, Chinese sources increasingly discuss the potential for weaponizing the Middle Kingdom’s major mineral advantage: rare earth elements (REE). Some link this impending “Battle of Rare Earths” the statements of Deng Xiaoping himself. Several things are already clear. China has long understood its REE preeminence and has sought to strengthen it. Beijing has leveraged it in recent years, and now threatens to do so again. But just how usable a weapon is China’s REE production preponderance and its current near-dominance in processing REE ores into finished metal?
China National Radio’s website shows a photo of “Deng noting in a speech he made January 1992 during his Southern Tour, ‘The Middle East has its oil, China has rare earths’” Various sources quote Deng elaborating during a speech in Jiangxi, “China’s rare earth deposits account for 80 percent of identified global reserves, you can compare the status of these reserves to that of oil in the Middle East: it is of extremely important strategic significance; we must be sure to handle the rare earth issue properly and make the fullest use of our country’s advantage in rare earth resources.”
Now Beijing seeks to brandish that advantage for dramatic effect. On May 29, People’s Daily published a strident commentary declaring that “the U.S. wants to use the products made by China’s exported rare earths to suppress and counter China’s development. The Chinese people will never agree. At present, the United States completely overestimates its ability to manipulate the global supply chain….” Importantly, this authoritative publication states, “I advise the US side not to underestimate China’s ability to safeguard its own development rights and interests, don’t say I didn’t warn you!”
This “rare Chinese phrase that means ‘don’t say I didn’t warn you’” is clearly deliberate and important.