On October 14, 2025, U.S. Treasury Secretary Scott Bessent publicly accused China of deliberately attempting to weaken the global economy by imposing export controls on rare earth minerals and other critical resources essential for advanced technology manufacturing. Speaking to the Financial Times, Bessent stated that China’s recent restrictions on exports of these vital materials are a strategic effort by a struggling Chinese economy "to pull everybody else down with them." This statement came amid ongoing U.S.-China tensions over trade, technology, and national security, with the backdrop of high-level talks held in Madrid in September 2025.
Bessent’s remarks highlight the growing concern within the U.S. administration, led by President Donald Trump since January 2025, about China’s increasingly aggressive economic policies. The export controls target rare earth elements—key inputs in semiconductors, electric vehicles, and defense technologies—where China controls approximately 60% of global supply. By restricting these exports, Beijing aims to pressure the U.S. and its allies to ease their own export restrictions on advanced computer chips and technology sales to China.
China’s move is widely interpreted as a retaliatory measure against U.S. sanctions and export controls that have sought to curb China’s technological advancements and military modernization. However, Bessent warned that such tactics could ultimately harm China more than the rest of the world, as the global economy is highly interconnected and reliant on stable supply chains for these critical materials.
From an economic perspective, China’s export controls come at a time when its growth is slowing amid internal challenges such as debt pressures, demographic shifts, and geopolitical isolation. By leveraging its dominance in rare earths, Beijing appears to be attempting to create leverage in ongoing trade and technology disputes. Yet, this strategy risks accelerating efforts by the U.S. and allied nations to diversify supply chains and develop alternative sources of rare earths, thereby reducing China’s long-term influence.
Data from the U.S. Geological Survey indicates that while China supplies about 60% of the world’s rare earths, countries like the U.S., Australia, and India have been ramping up mining and processing capabilities. For instance, the U.S. recently designated India as a strategic partner in rare earth supply chain security, reflecting a broader geopolitical realignment aimed at countering China’s economic coercion.
Moreover, the export controls have immediate ripple effects on global technology sectors. Semiconductor manufacturers and electric vehicle producers face increased costs and supply uncertainties, potentially slowing innovation and production. This disruption could contribute to a broader economic slowdown, which Bessent suggests China is willing to endure to maintain geopolitical leverage.
Looking ahead, the Trump administration is likely to intensify efforts to build resilient supply chains and strengthen alliances with resource-rich countries. This includes increased investment in domestic rare earth mining and processing technologies, as well as diplomatic initiatives to form multilateral frameworks that reduce dependency on China.
In conclusion, Bessent’s comments underscore a critical juncture in global economic relations where China’s economic vulnerabilities are prompting aggressive, high-stakes tactics that risk destabilizing global markets. While China’s export controls on rare earths may offer short-term leverage, they also accelerate a global push toward supply chain diversification and technological decoupling. This evolving landscape will shape the trajectory of U.S.-China relations and global economic stability throughout 2026 and beyond.
According to CNBC, these developments mark a significant escalation in economic statecraft, reflecting the broader strategic competition between the U.S. and China under President Trump’s administration.
