The Chinese government controls the fate of the global auto industry, monopolizing the export of rare earth magnets, a key component in electric vehicle motors. It added them to an export control list in April as part of its trade war with the United States.
The Ministry of Commerce’s Bureau of Industrial Safety and Import and Export Supervision is responsible for reviewing export permits for rare earth magnets. These magnets are essential for car engines, wind turbines, and even American F-35 fighter jets.
China uses its rare earth exports as a means of pressure on the United States and Western countries. Knowing there is no real alternative to Chinese exports, it deliberately creates scarcity and delays in fulfilling backlogs of orders, threatening the global auto industry and potentially increasing financial losses for Western companies.
Using exports as a means of pressure is not a Chinese idea. The United States has been using this method for decades in many areas, allowing it to control global industry and impose its hegemony over the international economy.
