In an effort to increase its influence over China’s exports, Trump is chasing Ukraine’s rare earth and vital minerals. However, the US’s efforts to reduce its dependency on China may take time.
In order to make up for US military assistance to Ukraine during the conflict, US President Donald Trump is requesting $500 billion (€477 billion) in Ukraine’s rare earth and vital minerals as part of a peace agreement. More significantly, obtaining these resources is consistent with his strategic objective to rebalance the US’s position in international commerce, especially with regard to China. However, following a heated exchange between Trump and Ukrainian President Volodymyr Zelenskyy, the US opted to suspend all military assistance to Ukraine, leaving peace negotiations at a standstill.
Since his first term, Trump has been committed to “making America great again,” and he has protected the domestic manufacturing sector by imposing tariffs on China. However, the US has difficulties reversing economic relations because of China’s long-standing manufacturing infrastructure and supply chain system, especially considering its high-tech industry’s reliance on China for vital minerals. Because of this, the peace negotiations represent a pivotal moment in Trump’s tariff strategy about his ability to intensify actions against Chinese exports.
To what extent does the United States respond to China’s vital minerals?
As he moves on with imposing a 25% levy on the two biggest trading partners today, the US president has increased import taxes on Chinese goods to 20%. Why Trump hasn’t imposed more severe tariffs on China like he does on Canada and Mexico may be a question that some people have.
Critical minerals, which are essential resources for producing electric products, battery-powered vehicles, airplanes, and defense equipment, are largely supplied by China to the US. More than half of the 50 key minerals listed by the US government in 2022 are produced in China, according to TD Economics. Furthermore, it processes 90% of rare earth elements, giving it a near-monopoly in refining capabilities. According to several estimates, Washington imported 70% of its rare earth metals from China between 2020 and 2023. Because of this, obtaining a backup supply from Ukraine is a crucial part of Trump’s strategy.
One day after the United States imposed new limitations on chip exports to China, China implemented an export embargo and restrictions on a number of vital minerals to the United States in December 2024. Beijing strengthened regulations for sending graphite products to Washington and stopped exporting antimony, gallium, germanium, and ultra hard minerals. While graphite is necessary for the production of nuclear reactors and electric cars, gallium is a dependable and long-lasting element employed in the defense industry.
