China's move on rare earths aimed at safeguarding the industry

China's latest move to strengthen export controls on rare earths and related items is designed to safeguard the security and stability of global industrial and supply chains, ensuring compliant trade, not to restrict exports, said analysts on Sunday.

China is still the key processor of rare earths and a major supplier of advanced graphite. That role gives it both the duty and the incentive to keep compliant exports flowing, said Li Jin, chief researcher at the China Enterprise Research Institute in Beijing.

Ding Rijia, a professor of economics at the China University of Mining and Technology-Beijing, said that if carried out with steady rules, China's policy can strengthen—not split—global supply chains and support long-term investment in green and high-tech manufacturing.

China announced on Thursday that it would impose export control measures on technologies related to rare earths, with immediate effect.

Hours later, the country also issued several consecutive announcements, implementing export controls on items related to superhard materials, some rare earth equipment and raw and auxiliary materials, some medium and heavy rare earth items, and items related to lithium batteries and artificial graphite negative electrode materials.

In a follow-up statement on Sunday, the Ministry of Commerce defended the country's export control measures on rare earths and related items as a legitimate action, while urging the United States to properly manage differences through dialogue and on the basis of mutual respect and equal-footed consultation.

A ministry spokesperson said that China's export controls are not export bans. Licenses will be granted for eligible applications.

The commerce official said that before the measures were announced, China had already notified relevant countries and regions through bilateral export control dialogue mechanisms.

"China stands ready to work with the rest of the world to step up export control dialogue and exchange, so as to better safeguard the security and stability of global industrial and supply chains," the spokesperson added.