US President Donald Trump has declared a 100% tariff on products coming from China, starting November 1st. This means that goods from China will now have a total tariff of 130%, as there was already a 30% tariff in place.
Trump also wants to control the export of important software from November 1st. This announcement comes after China tightened its own export rules on rare earth materials on October 9th. Under the new rules, foreign companies that use Chinese minerals or technology will need special licenses, and China won't give these licenses to companies linked to foreign militaries. Trump said that this situation could create problems for many countries.
China controls 12 rare earth materials
China possesses 17 of the world's rare earth materials, which it exports to the world. These are used in electronics, EVs, and the defense sector. China already controlled seven rare minerals, but on October 9th, five more (holmium, erbium, thulium, europium, and ytterbium) were added.
This means that China now controls 12 of the 17 rare minerals. Export licenses will be required before using them.
This move could impact the security and industry of the United States and its allies, as China controls 70% of the world's rare mineral supply and 90% of its processing.
President Trump said, "Following China's announcement, many countries have contacted us, deeply angered by China's restrictions. Therefore, there seems to be no reason to meet Xi Jinping at APEC."
Trump wrote, "China is becoming increasingly aggressive." It's restricting access to metals and magnets used in electronics, computer chips, lasers, jet engines, and other technologies. We've been contacted by several countries that are deeply upset by this sudden, major trade conflict.