U.S. Treasury Secretary Accuses China of Undermining Global Economy with Rare Earth Export Controls

U.S. Treasury Secretary Scott Bessent has accused China of attempting to harm the global economy by imposing extensive export controls on rare earth elements and critical minerals, actions that have disrupted international supply chains. Bessent stated that these measures reflect underlying issues within China's own economy.

"This is a sign of how weak their economy is, and they want to pull everybody else down with them," Bessent said on Monday.

He further criticized China's approach, suggesting that harming customers is not a viable business strategy, especially given China's significant role as a global supplier.

"Maybe there is some Leninist business model where hurting your customers is a good idea, but they are the largest supplier to the world," he added. "If they want to slow down the global economy, they will be hurt the most."

Bessent also noted that China is experiencing economic difficulties and is attempting to export its way out of them, which he believes is damaging its international standing.

"They are in the middle of a recession/depression, and they are trying to export their way out of it. The problem is they’re exacerbating their standing in the world."

These comments come shortly after China announced broad restrictions on the export of rare earths and critical minerals, prompting President Donald Trump to threaten an additional 100% tariff on Chinese imports starting November 1. U.S. officials have expressed concern over China's actions, viewing them as disproportionate and potentially harmful to global economic stability.

In response, the U.S. is considering countermeasures, including requiring companies exporting software to China to obtain licenses, a move that could significantly impact Chinese industries. The situation is expected to be a priority during upcoming G7 meetings in Washington.

The escalating tensions underscore the fragile state of U.S.-China relations, with both nations implementing measures that could have far-reaching implications for global trade and economic growth.