The Treasury chief said Beijing’s export controls have alerted trading partners to the dangers of relying on China for critical minerals.
Treasury Secretary Scott Bessent said China “made a real mistake” by threatening to restrict exports of rare earth minerals, adding that Beijing’s move has jolted the United States and its allies to fast-track efforts to secure new sources within the next two years.
In an interview published by the Financial Times on Oct. 31, Bessent said China had drawn global attention to its willingness to use critical minerals as leverage.
“China has alerted everyone to the danger. They’ve made a real mistake,” he told the newspaper.
“It’s one thing to put the gun on the table. It’s another thing to fire shots in the air.”
China imposed new controls on the export of technologies and materials linked to rare earth elements in early October. The restrictions rattled markets, upended supply chains, and became a major sticking point in trade negotiations between Washington and Beijing.
Following this week’s meeting between President Donald Trump and Chinese leader Xi Jinping on the sidelines of the Asia-Pacific Economic Cooperation (APEC) summit in South Korea, China announced that it would suspend the restrictions for one year.
“I think the Chinese leadership were slightly alarmed by the global backlash to their export controls,” Bessent told the Financial Times.
The Treasury chief said the United States and China had reached an understanding that would stabilize relations in the near term, while expressing the conviction that Beijing’s influence in the critical minerals sector would quickly fade.
“There’s an agreement that, ceteris paribus, we have reached an equilibrium, and we can operate within that equilibrium over the next 12 months,” Bessent said.
“I don’t think they’re able to do it now because we have offsetting measures.”
He said that China’s ability to use rare earths as a coercive tool would not last more than a 12- to 24-month period, underscoring the Trump administration’s efforts to diversify the U.S. supply chain through new mining and refining operations, including through partnerships in Southeast Asia and allied countries.
The suspension of Beijing’s controls also extends beyond U.S. markets.
By Tom Ozimek
