US warns world will "decouple" from China if it imposes new export controls
Top U.S. officials have accused China of reneging on a trade truce made earlier this year, ramping up tensions between the two economic powers.
In a rare, orchestrated public display, U.S. Trade Representative Jamieson Greer and Treasury Secretary Scott Bessent denounced China’s proposed cuts to rare-earth exports as “economic coercion” and “a global supply-chain power grab.”
“If China wants to be an unreliable partner to the world, then the world will have to decouple,” Bessent declared. Yet he and Greer also left room for diplomacy, questioning whether Beijing would actually follow through on the export restrictions it recently unveiled.
“The scope and the scale is just unimaginable, and it cannot be implemented,” Greer said Wednesday, referring to China’s intensified export rules.
China currently handles roughly 90% of global rare-earth and magnet processing — critical inputs for advanced technologies ranging from cars to smartphones. This dominance presents a notable strategic weakness in trade negotiations for the U.S., whose firms rely heavily on those materials.
Under Beijing’s new rules, foreign firms will need government approval to export products containing even trace amounts of rare earths, along with justification of their intended use. Similar constraints were announced for lithium-ion batteries and certain forms of graphite — materials essential to the tech supply chain.
Trump responded last week by threatening a 100% tariff on Chinese imports beginning next month and said the U.S. would impose export controls on critical software. Greer confirmed those policies are currently under development.
On another front, the U.S. and China began charging new port fees on each other’s vessels this week — another sign of the relationship’s strain.
This surge in trade tensions comes ahead of a planned meeting between Trump and Chinese President Xi Jinping, and it stirs concern over the fragile trade truce brokered in spring re-collapsing into a full-scale trade war. The two nations had agreed in May to suspend tariffs that had once soared as high as 145%. Since then, Chinese goods into the U.S. have been subject to an additional ~30% tariff relative to the start of the year, and U.S. goods entering China now carry a 10% tariff.
Greer pointed out that while tariff rates were cut following the May deal, “now the Chinese have expanded their export controls.” Bessent said U.S. automakers have already warned the White House about potential supply disruptions. He described Beijing’s move as “unacceptable” and “highly provocative,” stating bluntly: “This is China versus the world. We and our allies will neither be commanded nor controlled. We are not going to let a group of bureaucrats in Beijing try to manage the global supply chain.”