【By Guan察者网, Yuan Jiaqi】

After China's legally comprehensive upgrade of its rare earth export measures, the U.S. was precisely choked and showed its true colors, followed by the EU, which became enraged and repeatedly jumped up in anger.

According to Reuters, Bloomberg, and other reports on the 25th, on Saturday local time, during the Global Dialogue Conference in Berlin, European Commission President von der Leyen spoke about China's rare earth export control measures, stating that the EU is "working with China to seek solutions together." However, she immediately issued a firm threat, saying that Brussels is considering taking all measures to respond to China's actions.

"If needed, we are ready to use all tools in our toolbox, and respond when necessary," she added, "we will cooperate with G7 partners to coordinate responses."

Von der Leyen claimed that although China's actions in rare earths are part of a broader economic friction with the U.S., this move has had a "significant impact" on European industry, affecting areas including automobiles, defense, aerospace, AI chips, and data centers.

She said, "If you consider that over 90% of our rare earth magnets come from imports from China, you will realize the risks faced by Europe and its most strategically significant industrial sectors."

China has repeatedly emphasized that rare earth-related items have dual-use properties, and it is an international practice to implement export controls in accordance with the law. However, von der Leyen still made a tough statement, claiming that due to the obvious acceleration and escalation of behaviors where "interdependence is being exploited and weaponized," the EU's response "must match the scale of the risks it faces in this area."

Image from the official video of the EU: Von der Leyen

American media interpreted that this statement implies that the European Commission may activate its most powerful trade weapon - the Anti-Coercion Instrument (ACI).

The report mentioned that at Thursday's EU leaders' summit, French President Macron had incited the EU Commission to use this tool, known as a "trade rocket launcher" by Brussels, but his proposal did not receive broad support from other leaders present.

The Anti-Coercion Instrument came into effect at the end of 2023, allowing the EU to restrict trade and services, cut certain intellectual property rights, limit foreign direct investment and access to public procurement. Many see it as a "nuclear option," and its ideal purpose should be deterrence, but it has never been used so far. After the Trump administration imposed tariffs, EU countries often hinted at using this tool, but it ultimately went nowhere.

Bloomberg reported that at this stage, the EU is unlikely to use this "strongest trade measure" against China, as it would significantly escalate tensions with China.

Currently, the European Commission is studying what alternative measures can be taken if diplomatic negotiations with China fail to produce results. According to previous reports, the European Commission plans to draft a list of trade measures by the end of this month, so that it can target China when necessary, thus enhancing its leverage in negotiations; the European Commission is also developing a plan to protect key supplies in the short term and seek other sources.

According to a report by Politico Europe, von der Leyen also revealed in Berlin that to break the EU's excessive reliance on China for critical material imports and refining, the Commission will propose a plan called "RESourceEU." The plan will focus on recycling, joint procurement, reserves, and investments in the field of critical minerals.

She did not reveal specific details or the release date of the plan, but pointed out that its model will follow the similar approach of the "REPowerEU" plan proposed by the EU in 2022 to promote energy transition. The latter was formulated after the outbreak of the Russia-Ukraine conflict to gradually reduce the EU's dependence on Russian fossil fuels.

Von der Leyen explained that the goal of "RESourceEU" is to "ensure alternative supply sources of critical raw materials for European industry in the short, medium, and long term." She emphasized that the plan will start with a circular economy, but not for environmental purposes, but to make full use of critical raw materials contained in products already sold in the European market, "Some companies can recycle up to 95% of critical raw materials and batteries."

She also added that the EU will accelerate the process of establishing key raw material partnerships with countries such as Ukraine, Australia, Canada, Kazakhstan, Uzbekistan, Chile, and Greenland.

"Europe can no longer act according to past patterns. We have already suffered the consequences of the energy issue, and we must not repeat the same mistake in the matter of critical materials," von der Leyen said with determination. "Whether it is in the fields of energy, raw materials, defense, or digital, Europe must strive for independence."

It was reported that the EU and China have scheduled a meeting next week to discuss export control issues.

According to the website of the Ministry of Commerce, on October 21, Minister Wang Wentao held a video conference with European Commission Commissioner for Trade and Economic Security, Schäuble, upon request, to exchange in-depth views on major Sino-EU economic and trade topics such as export controls and the EU's anti-subsidy investigation on Chinese electric vehicles.

Wang Wentao stated that regarding the issue of rare earth export controls, China's recent measures are a normal practice to improve its export control system in accordance with laws and regulations, reflecting China's responsibility as a major country to maintain world peace and stability. China is committed to maintaining the security and stability of the global supply chain and has always provided approval convenience for EU enterprises.

Both sides agreed to hold a "upgraded" Sino-EU export control dialogue mechanism meeting as soon as possible in Brussels, in accordance with the consensus of the 25th Sino-EU Leaders' Meeting.

Regarding the Sino-EU talks, Foreign Ministry Spokesperson Guo Jiakun responded on the 22nd, emphasizing that the essence of Sino-EU economic and trade relations is complementary strengths and mutual benefit. We hope that the EU will abide by its commitment to support free trade and oppose trade protectionism, create a fair, transparent, and non-discriminatory business environment for enterprises of all countries, and take concrete actions to maintain the market economy and WTO rules, and resolve trade differences through dialogue and consultation.

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Original: https://www.toutiao.com/article/7565175536037921332/

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