10 June,2019 10:22 AM IST | | Agencies
US President Donald Trump and China's President Xi Jinping. File pic
Phoenix: Rising trade tensions between the US and China have sparked worries about the 17 exotic-sounding rare earth minerals needed for high-tech products like robotics, drones and electric cars.
China recently raised tariffs to 25 per cent on rare earth exports to the US and has threatened to halt exports altogether after the US raised tariffs on Chinese products and blacklisted Huawei.
With names like europium, scandium and ytterbium, the bulk of rare earth minerals are extracted from mines in China, where lower wages and lax environmental standards make production cheaper and easier.
Although the US is among the world's top 10 countries for rare earths production, it's also a major importer of the minerals. China last year produced some 120,000 metric tons of rare earths, while the US produced 15,000 metric tons. But trade experts say no one should panic over China's threats to stop exporting the elements to the US.
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"The sky is not falling. There are alternatives," said Mary B Teagarden, a China specialist, associate dean at the Thunderbird School of Global Management in Phoenix.
Simon Lester, associate director at the Cato Institute think tank in Washington, agreed. "Over the short term, it could be a big disruption, but companies that want to stay in business will find a way," he said.
The United States has called upon China to resume the stalled trade talks and return to the negotiating table or face more tariffs from the Donald Trump administration. "If they want to come back to the table and complete the deal on the terms that we were continuing to negotiate, that would be great," the New York Times quoted US Treasury Secretary Steven Mnuchin as saying on Saturday. "If not, as the president said, we will move on with tariffs," Mnuchin added.
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