The Trump administration plans to deploy nearly USD 12 billion to create a strategic reserve of rare earth elements, a stockpile that could counter China`s ability to use its dominance of these hard to process metals as leverage in trade talks. The White House confirmed on Monday the start of "Project Vault," which would initially be funded by a USD 10 billion loan from the US Export-Import Bank and nearly USD 1.67 billion in private capital. The minerals kept in the reserve would help to shield the manufacturers of autos, electronics and other goods from any supply chain disruptions.

During trade talks last year spurred by President Donald Trump`s tariffs, the Chinese government restricted the exporting of rare earths that are needed for jet engines, radar systems, electric vehicles, laptops and phones. China represents about 70 per cent of the world`s rare earths mining and 90 per cent of global rare earths processing. That gave it a chokehold on the sector that has caused the US to nurture alternative sources of the elements, creating a stockpile similar to the national reserve for petroleum.