Trade conflict
Rare earths: Industry warns of dependence on China
China’s export controls meet the German industry. She warns that Beijing could also flood the market at any time. That too would have negative consequences.
In the middle of the global trade conflicts, German industry warns of growing dependence on China in critical raw materials such as rare earths. “China’s government has recognized that it can use the dependence of Europe on rare earth to force concessions in other fields,” said Stefan Steinicke, raw material expert at the Federal Association of German Industry (BDI), the news magazine “Spiegel”.
China is reduced by export less frequently so far that other countries build heavy traps to build strategic reserves. At the same time, however, Beijing is always able to flood the world markets with raw materials again to send prices on a descent.
Investments in your own funding according to BDI risk
Investments in the expansion of funding and processing are therefore a high risk for western companies. According to the BDI representative, the structure of the capacities will not be possible without government aid. Despite existing funding, Germany has so far hardly made any progress.
Due to China’s export restrictions on rare earths, industry was recently under significant pressure outside of the People’s Republic. In Germany, too, companies in the automotive industry or in mechanical engineering also take care of the replenishment of the important metals, which are installed in sensors or electric motors, for example.
Rare earth as a weapon in the trade dispute
China justified the controls by the fact that the raw materials were goods for civilian, but also military use. Although the measures were primarily a reaction to the trade dispute with the USA – they apply to all countries and thus also affect European companies.
It was heard from companies that the Chinese Ministry of Commerce takes a long time to process the applications – without certainty on approval. Worries about possible still stands in the productions spread. The Ministry of Commerce repeatedly emphasized that it had already approved applications for companies in the EU and wanted to accelerate the process.
dpa
Source: Stern
