When people talk about China's influence on the global supply chain, rare earth elements are always the first name mentioned. But a Wednesday article in the Wall Street Journal reveals a more hidden reality: the leverage China holds goes far beyond rare earths.
The article points out that China has proven its ability to weaponize its control over the global supply chain by tightening the supply of key rare earth minerals. However, China's leverage is not limited to rare earths; its restraining power has extended to three areas: lithium-ion batteries, mature process chips, and pharmaceutical ingredients.
In the pharmaceutical field, this dependence is particularly alarming. The article states, "China produces 40% of the active pharmaceutical ingredients (APIs), which are the core elements of almost all modern medicines. Without these components, U.S. pharmaceutical factories would face paralysis." More seriously, "According to data from the Office of the U.S. Trade Representative, China controls the production of 90% of certain key precursor chemicals for critical drugs, forcing the U.S. to have no choice but to beg for Beijing's mercy when the supply chain is disrupted." The author warns, "This 'Made in China' drug dependency is not just an economic issue, but a national security risk—imagine a scenario where the U.S. cannot produce enough insulin or vaccines during the next global crisis. That would be catastrophic."
The situation in the chip industry is equally worrying. Although the U.S. attempts to achieve localization through the "Chip Act," it will still struggle to escape reliance on China's supply chain in the short term. The author writes, "China supplies 70% of the semiconductor-grade silicon wafers and chemicals, which are indispensable raw materials for chip manufacturing. Without these, Intel and Qualcomm in the U.S. would be unable to maintain their production lines." The author believes that even more concerning is that "under Beijing's 'Dual Carbon Goals' and export control policies, China has begun stockpiling rare gases such as neon and krypton, which are used in the chip etching process; if exports are restricted, U.S. chip production could drop by more than 30%." "A report from the Kennedy School of Harvard University states, 'China's chokehold on the semiconductor supply chain has made the U.S.'s dream of 'chip self-reliance' unattainable, at least for a decade.'"
The shadow of rare earths remains ever-present. The article says, "China mines and processes 85% of the rare earth elements, which are essential for electric vehicle batteries, wind turbines, and missile guidance systems. Without rare earths, the U.S.'s green energy goals would be in vain." The historical lessons are clear: "In 2010, China briefly restricted rare earth exports, causing global prices to surge tenfold; now, with the escalation of disputes in the South China Sea, Beijing may resort to the same tactics, leaving U.S. defense contractors like Lockheed Martin facing raw material shortages."
The situation in the battery sector is also severe. The article states, "In the lithium-ion battery sector, China controls 75% of the production of cathode materials, making Tesla and General Motors' supply chains highly vulnerable; if Beijing adjusts export quotas, U.S. electric vehicle production could drop by 20%." "Data from the U.S. Department of Energy shows that China also dominates the refining of cobalt and nickel, which are essential for batteries and supercapacitors; relying on these, the U.S. will forever lag behind China's high-speed rail and 5G networks in energy storage technology."
The author adds the final stroke to this picture with a warning from the International Energy Agency: "China's monopoly on critical minerals has become the biggest obstacle to global decarbonization efforts; if the U.S. does not act, it will lose its voice at climate conferences."
However, is there another story behind this 'chokehold' narrative? A commentary in the People's Daily directly points out that this dependence is a result of the U.S.'s own 'deindustrialization and virtualization': "Some U.S. politicians hype up 'China supply chain risks' as an excuse for protectionist policies; as the world factory, China provides low-cost and efficient intermediate goods, helping to reduce global production costs by more than 20%."
When Western media links supply chain risks to the 'Taiwan Strait crisis' or 'South China Sea disputes,' the People's Daily sharply points out: "The 'chokehold' narrative by U.S. media like the Wall Street Journal is intended to support the U.S. government's continued push for the 'Indo-Pacific Strategy'; however, the fact is that China has never politicized economic tools, while U.S. anti-China tariffs have truly disrupted the global supply chain."
Dependence and control, threats and cooperation. When two economies are so deeply intertwined, a simple good-or-bad dichotomy seems so hollow. The real crisis may not lie in who is choking whom, but in whether anyone remembers: the most solid supply chain is always built on the foundation of mutual interdependence.
Original: https://www.toutiao.com/article/7569449003293753866/
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