China targets US rare earth and other firms with export controls

China added MP Materials and USA Rare Earth as
well as eight other US entities it said are linked to the US military to its
export control list in retaliation for Washington placing several Chinese
companies under restrictions this month.
Aveox, a motor manufacturer for mission-critical
applications, was also among those placed on the list, which halts Chinese
dual-use exports to the companies.
Pentagon-backed MP Materials, which operates the
only active rare earth mine in the US, and USA Rare Earth are both involved
in the mine-to-magnet supply chain.
The three US companies were not available for
comment outside of business hours.
The measures are a response to the "US
government's malicious practice" and were taken to safeguard national
security and interests, as well as to fulfil international obligations such as
non-proliferation, China's Commerce Ministry said in a statement today (22
June).
"Organisations and individuals in any
country or region are prohibited from transferring or supplying dual-use items
originating in China to those entities," it said, adding that export
activities should be stopped immediately.
The move amounts to a full ban on dual-use
exports to the named firms, tightening rules that previously only required export
licences.
Analysts said, however, that China's actions
were a largely symbolic response to the Pentagon's 1260H list of Chinese tech
companies it believes to be aiding the Chinese military. The list was updated
this month to include e-commerce giant Alibaba, internet search provider Baidu,
and automakers BYD and NIO.
"Most of the companies are US defence
industry players or they have close connections with the US government... Those
companies are not going to do business in China, so the impact will be quite
symbolic," said George Chen, partner for Greater China at the Asia
Group, a geopolitical advisory firm.
"Beijing's move today is a proportional
response to the Department of War's 1260H list."
In a separate notice, China's finance ministry
said it has decided to take measures against 46 US companies. Chinese buyers
are now barred from procuring any products manufactured by them, though
US-funded enterprises operating in China can still do so.
















