China warns of supply chain disruption amid trade tensions

China warns of supply chain disruption amid trade tensions

China has warned that supply chains could be disrupted as major trading partners consider new strategies to tackle growing imbalances and reduce reliance on rare earths.

"Unilateralism and protectionism are on the rise, the risk of global supply chain fragmentation is growing," said Chinese Vice Premier Ding Xuexiang at the opening ceremony of China International Supply Chain Expo in Beijing on Monday.

G7's rare earth import restrictions

China's growing trade surplus with major partners has drawn attention in recent months.

The European Union is considering new measures to counter this export surge.

Meanwhile, the Group of Seven (G7) countries recently agreed that no country should provide more than 60% of its rare earths imports from a single country by 2030, as part of efforts to reduce dependence on China.

China's export controls

In response to the G7's move, China has imposed export controls on two US rare earth producers.

This is not the first time China has used its control over rare earths supply chains as leverage. Last year, it restricted their exports in retaliation against Donald Trump's tariffs.

Rare earths are crucial for manufacturing modern technologies from smartphones to fighter jets.