The European Union is taking urgent action to confront what it describes as China's 'racket' in controlling the global supply of rare earth minerals, essential components for modern technology and defense systems.
Confronting the Export Control 'Racket'
EU Industry Chief Stephane Sejourne delivered a stark warning to the European Parliament, highlighting how China is using export licenses as leverage. He revealed that these licenses are 'issued in dribs and drabs', causing significant delivery delays and forcing European manufacturers to surrender sensitive trade secrets to secure supplies.
'These requirements look like a racket if we consider all the demands made on our manufacturers to obtain licences,' Sejourne stated emphatically. The situation escalated in October when China announced new export controls on these vital elements, sending shockwaves through international markets and supply chains before temporarily suspending the measures for one year.
Europe's Plan for Strategic Independence
In response to this growing crisis, Sejourne has been preparing a comprehensive strategy to end the 27-nation bloc's dependency on Chinese rare earths. This crucial plan is scheduled for announcement on December 3, 2025.
The EU executive will propose several key measures to secure Europe's industrial future:
- Accelerating the joint purchasing of critical raw materials
- Boosting domestic production and recycling capabilities within Europe
- Forging new partnerships with reliable international suppliers
- Establishing a European Centre for Critical Raw Materials
This new center, modeled after Japan's successful state-run corporation, will serve as the EU's central hub for assessing needs, collective buying, and strategic storage of essential minerals.
Global Trade Tensions and European Vulnerability
The rare earths conflict places Europe in a precarious position within global trade dynamics. Sejourne identified the bloc as both a 'collateral victim' of US-China trade tensions and 'directly targeted' by Beijing's policies.
These developments follow China's initial move in April requiring export licenses for certain rare earth materials, which already impacted global manufacturing sectors. The elements are indispensable for producing powerful magnets used in automotive manufacturing, consumer electronics, and advanced defense systems.
'It is high time for Europe to step up its game. To redouble its efforts to reduce our dependencies on China,' Sejourne told EU lawmakers, signaling a decisive shift in European industrial policy toward greater strategic autonomy.
