Media: U.S. Trade Representative Tells Allies They Must Pay National Security Premium for Critical Minerals Outside China

U.S. Trade Representative Jamieson Greer has informed allies that they must pay a higher cost for critical minerals sourced from outside China, as Washington seeks to break Beijing's dominance over key mineral supplies. Greer stated that America's allies must be prepared to pay a "national security premium" for these minerals, which would come from a range of proposed trading partners, including Europe.

The U.S. aims for this club to set minimum pricing in mineral trade to protect its investments in mining and processing, and potentially impose high tariffs or other trade barriers on external producers like China to prevent them from undercutting prices.

However, according to informed sources, the proposal has sparked concern among some allies following private talks between Washington and foreign officials. They fear the new plan could increase corporate costs and provoke trade retaliation from China.

Reporting by the Financial Times highlights that disagreements over the plan’s details underscore the difficulty of countering decades of careful investment by China in critical sectors—while wealthy economies struggle with soaring energy costs and inflation triggered by the war in Iran.

It is reported that Greer is already drafting a detailed proposal to share with partners. He argued that Western nations’ reliance on Chinese critical minerals stems from their excessive focus on commercial costs.

Greer noted, “When trade partners express concerns about economic costs associated with price floors or mechanisms, I simply say: [The cost-effectiveness you’re talking about is precisely the root of our current predicament].”

Speaking to U.S. allies, Greer said, “We are paying a premium for this; I call it a national security premium. To ensure supply chain security, all of us must pay this national security premium.”

Multiple informed sources revealed that within negotiations between Washington and its trade partners, there are concerns that protecting mineral resources could raise costs across industries such as defense, automotive manufacturing, and clean energy. These individuals also said U.S. allies privately worry the plan might provoke retaliation from China, as Beijing could oppose trade measures targeting its mineral resources.

For decades, China has dominated global mineral extraction and processing, leveraging its control over the industry to advance strategic objectives. Since China cut off rare earth exports last year through export controls, securing supply of rare earths and critical minerals has become one of the top priorities for the Trump administration.

Earlier this year, several U.S. trading partners expressed willingness to cooperate with Washington to secure mineral supply chains. The EU and Japan issued a joint statement pledging to “explore a multilateral trade initiative on critical minerals with like-minded partners.”

This initiative “could include” coordinated trade policy mechanisms such as border adjustment price floors, price differential subsidies, or agreements to mutually purchase minerals at agreed-upon prices.

Source: rfi

Original: toutiao.com/article/1863203534708747/

Disclaimer: This article reflects the personal views of the author