Mining of rare earths is conducted in Baiyunebo, North China's Inner Mongolia Autonomous Region on July 16, 2011. File photo: VCG

China announced on Wednesday that it will build a world-class manufacturing cluster for rare-earth functional materials in the Xiongan New Area in North China's Hebei Province, a significant move that industry insiders said signals policymakers' determination to dominate key technologies of the rare-earth sector that is deemed as China's leverage amid a lingering trade war.

The Hebei Innovation Center for Rare-earth Functional Material Production was set up in Xiongan on Tuesday, according to a post on the official WeChat account of the Xiongan governing body. The center was set up by a company founded by six centrally administrated state-owned enterprises and seven listed companies. 

The announcement came ahead of a widely anticipated meeting between Chinese and US leaders in Japan later this month. Chinese rare-earth industry insiders have repeatedly called for a ban on rare-earth exports to the US as a countermeasure against US tariffs.

The center's expert committee, chaired by the former vice president of the Chinese Academy of Engineering (CAE) Gan Yong, has more than 60 renowned experts and scholars in rare-earth technology and industry, among whom 21 are academicians from the CAE and Chinese Academy of Sciences, the post said. 

The founding companies also set up a strategic alliance with more than 60 major companies, universities and research institutions, covering 70 percent of the key labs and project research centers of the rare-earth industry. 

The center is expected to focus on making breakthroughs in weak links that are urgent for rare-earth industrial growth and solving issues involved in the engineering of key materials, techniques and equipment, the center's director Huang Xiaowei was quoted as saying in the post. "In this way, China can accelerate technological expansion and industrial application."

"China aims to build Xiongan into an example of a future city, and rare earths are China's strategic asset. We could expect more 'chemical reactions' from the innovation center in downstream technologies," Wu Chenhui, a Beijing-based independent rare-earth analyst, told the Global Times. 

Gong Xiaofeng, an official from the Hebei government, said that the local government will actively provide policy, capital and talent support for the center's construction. "We should transform China's rare-earth advantage into an industrial advantage that drives regional economic growth and becomes a national strategic advantage," Gong was quoted as saying in the post.

An industry insider, who asked not to be identified, said that the center's research into rare-earth new materials will yield new advanced technologies in downstream applications. 

"It could help China acquire dominance in every rare-earth sector and give China a great say amid trade talks," the insider told the Global Times.


Newspaper headline: Nation plans world-class rare-earth cluster in Xiongan New Area