SOURCE / ECONOMY
Regulation on rare-earth extraction technology ‘in line with international practice’
No added costs or obstacles to doing business for equal trading partner: analysts
Published: Dec 22, 2023 09:44 PM
rare earth Photo:VCG

Photo:VCG


China's revised catalogue for technologies that are banned and restricted from export is in line with international practice and is aimed at safeguarding economic security, Chinese analysts said, warning that Western smears against the country's role as a stable supplier of the vital rare-earth metals are groundless and carry ulterior aims.

China on Thursday launched a revised, shortened version of the Catalogue of Technologies Prohibited and Restricted from Export, aiming to create better con-ditions for promoting international trade cooperation, while safeguarding national economic security and development interests, according to a statement on the website of the Ministry of Commerce (MOFCOM).

The number of items subject to management was reduced from 164 in the previous version to 134, read the statement.

The content involving rare earths has received a lot of coverage by Western media, with some reports claiming that the change "will affect efforts in boosting Western supplies." However, Chinese analysts said such reports that try to emphasize China holding a monopoly of the vital resources may contain ulterior designs to disrupt China's rare-earth exports and dent prices, which would benefit some Western countries.

Such media reports have not taken note of the fact that China has proactively trimmed the length of its catalogue, which is in sharp contrast to the US, which has constantly extended and expanded its export control list in recent years in its technology crackdown against China.

Observers noted that the rule-based changes and reduction of items signal that China is not abusing political means to politicize technology and trade measures, which sets China apart from the practices in the Western world, particularly the US, in its arbitrary use of sanctions.

Mei Xinyu, a research fellow at the Chinese Academy of International Trade and Economic Cooperation, told the Global Times on Friday that China's move goes some way to coping with an international situation caused by a "decoupling" push by Western countries, especially the US.

The move will not alter the fact that China is a responsible and reliable supplier on the international market, Mei said. "Such changes were China's minimum and restrained reactions to the current complex international situation for the sake of its national economic security and development interests."

For any trading partners that regard China as an equal partner, there should be no increase in cost or extra obstacles to doing business, Mei said.

Tu Xinquan, dean of the China Institute for WTO Studies at the University of In-ternational Business and Economics in Beijing, told the Global Times on Friday that the revised export controls are focused on technology that will not impact the volume of China's exports.

The expert said there is no need to paint a scary picture of the move, and noted that technologies listed under the restriction column can still be exported after obtaining the relevant approval.

China's action is in line with international practice and it has never politicized technology and will not politicize it, Tu noted.

The new catalogue released on Thursday stipulated that rare-earth extraction technology is banned from export and regulated that a number of related techniques require approval before exports.

Rare earths are a group of metals used in high-tech industries from iPhones to fighter jets.

The US is trying to diversify rare-earth import sources, but Western rare-earth miners are 10 to 15 years behind in terms of the extraction of rare earths, industry experts said.

Despite media trumpeting that suppliers in Western countries are beginning to ramp up their rare-earth production, their scale is trivial as their mines often have an annual production of a few thousand tons, whereas in China, each mine can easily churn out 10,000 tons of raw rare earths a year, Wu Chenhui, an independ-ent industry analyst who closely follows the rare-earth industry, told the Global Times on Friday.

This fact shows the West lacks capability to extract rare earths in terms of patents, tech know-how and specialized equipment, Wu said, noting that the media fanfare that tries to paint China as having a monopoly of the resources is aimed at hitting rare-earth prices.

China imposed an export quota system to protect its environment and improve the structure of the rare-earth industry.

Huang Zhiyong, a rare-earth magnet industry veteran based in Dongguan, South China's Guangdong Province, told the Global Times on Friday that rare-earth re-fining and whole-supply-chain advantage are the two key elements of China's advantage in rare earths.

But Huang noted that China's production of rare earths also faces environmental strains, and is also positioned in general at the mid- and lower-end in downstream application, as many of the patents are in the hands of developed countries such as Japan.

China has consistently adhered to promoting reform and development through opening up and is always ready to create enabling conditions for international economic and trade cooperation on the basis of ensuring national economic security and development interests, FM spokesperson Wang Wenbin told a regular press conference on Friday, responding to a question on the revised catalogue.

The revised catalogue is being rolled out as China adapt to the latest technological advancement and better manage technology trade and a routine update, Wang said.

The advantage of China's rare-earth industry does not come from a European style abuse of regulations or a US-style abuse of sanctions, but from its efficiency and the capability to extend along the industrial and supply chain in an innovative manner, Mei said.