The United States signaled a tougher stance toward China on Sunday (Nov 2), warning that tariffs could be raised again if Beijing fails to honor its commitments on rare earth exports. Treasury Secretary Scott Bessent said the Trump administration is ready to use “maximum leverage” to ensure that China does not weaponize its dominance in the critical materials market.
Appearing on Fox News, Bessent cautioned that while Beijing announced a one-year suspension of export restrictions imposed in October, Washington remains skeptical. “The Chinese have cornered the market on rare earths and, unfortunately, at times they proved to be unreliable partners,” he said. “If they don’t follow through, we could threaten the tariffs again.”
Rare earth elements—17 minerals essential for high-tech manufacturing, electric vehicles, and advanced defense systems—have become a geopolitical flashpoint between the two superpowers. Although these materials are mined in several countries, China controls nearly 90 percent of global processing capacity, giving it outsized influence over supply chains.
The temporary suspension announced Thursday came after talks between President Donald Trump and Chinese President Xi Jinping in South Korea. Despite the apparent thaw, some restrictions remain in place, underscoring continued friction between Washington and Beijing over technology access and trade dependencies.
Bessent described the agreement as a “step forward,” but warned that Beijing’s record on economic pledges has been uneven. “We don’t want to decouple from China, but we’re going to have to de-risk,” he said. “We can’t allow a single country to hold the rest of the world hostage over materials that power our modern economy.”
The Treasury Secretary blamed previous U.S. administrations for allowing China to dominate the rare earth industry. “They were asleep at the switch,” Bessent said in a separate interview with CNN. “Now this administration is going to go at warp speed over the next one or two years to get out from under this sword that the Chinese have over us — and they have it over the whole world.”
Since taking office, the Trump administration has accelerated investment in domestic mining, refining, and recycling of rare earth elements. Washington has also sought to coordinate with allies including Australia, Japan, and Canada to build alternative supply chains and reduce reliance on Chinese processing facilities.
As part of the newly announced understanding between Washington and Beijing, the United States will reduce tariffs on Chinese exports by 10 percent, a gesture meant to sustain diplomatic momentum following the South Korea meeting. In return, China has pledged to maintain the one-year suspension on rare earth export restrictions and to expand cooperation on anti-narcotics measures, particularly targeting fentanyl trafficking.
The synthetic opioid has been a major point of contention in U.S.-China relations. According to the U.S. Drug Enforcement Administration (DEA), China remains the largest source of fentanyl and its precursor chemicals, which have fueled an opioid crisis claiming tens of thousands of American lives annually. Under the latest agreement, Beijing has committed to tighter monitoring of its chemical exports and enhanced coordination with U.S. law enforcement.
Analysts view the rare earth standoff as part of a broader strategic competition between Washington and Beijing that extends beyond trade into technology and national security. Rare earths are vital for producing everything from fighter jets and precision-guided missiles to smartphones and wind turbines. Any disruption in supply could have far-reaching global consequences.
While Bessent’s comments reflect confidence in Washington’s ability to diversify supply chains, experts warn that the transition could take years. “China’s dominance in rare earth processing isn’t just about mining—it’s about decades of investment in refining technologies and industrial ecosystems,” said a senior fellow at the Center for Strategic and International Studies. “Even with political will, catching up will be costly and complex.”
Despite the harsh rhetoric, Bessent emphasized that the Trump administration seeks a balanced approach. “We want a stable relationship with China,” he said. “But stability has to be built on trust and fairness, not dependency and coercion.”
The Treasury chief’s warning underscores the fragile nature of the U.S.-China truce. Both sides appear eager to prevent a return to the full-scale trade war that rattled global markets in 2019, but mutual suspicion continues to define their relationship.
As the world’s two largest economies navigate a new phase of cautious engagement, Washington’s message to Beijing was unmistakable: cooperate—or face renewed tariffs and economic isolation.
