The trade conflict between the US and China has shown signs of improvement, particularly concerning rare earth exports, following a recent truce between President Trump and President Xi.
• China has begun approving rare earth export licenses, signaling an easing of trade constraints.
• The Ministry of Commerce in China announced the approval of general export licenses, simplifying the licensing process that was previously highly bureaucratic.
• These general licenses are valid for up to a year and allow approved buyers to make repeated shipments with reduced paperwork.
• The EU’s trade chief, Maros Sefcovic, indicated that the EU is actively seeking these licenses to facilitate access to rare earths, which are vital for various industries, including automotive and technology.
• Since April, the approval rate for license requests has improved from about 50% to approximately 70%.
• China's control over rare earth minerals remains significant, making them a strategic asset in trade negotiations.
The easing of the licensing process by China helps restore rare earth trade with the West, reflecting a shift in the trade relationship post-truce and highlighting the ongoing importance of these minerals in global industries.
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