【By Observer Net, Qi Qian】

After China introduced the latest new regulations on rare earth exports, the United States has become anxious and has started to frequently make statements.

According to a Reuters exclusive report on October 23, several sources said that the Trump administration is considering a move to restrict software-driven products from being exported to China, covering everything from laptops to jet engines, as a response to China's rare earth policy.

However, these sources also pointed out that the plan may not be implemented in the end, but rather used as a means of pressure on China. Some U.S. analysts have warned that such software controls would be extremely difficult to implement and could backfire on the U.S. industry.

"I can confirm that everything is under consideration," when asked about the issue at the White House, U.S. Treasury Secretary Becerra responded to reporters on the 22nd, "If these export controls happen, whether it's software, engines or other products, we may coordinate with our allies such as the G7."

The White House declined to comment. The U.S. Department of Commerce, responsible for export controls, did not respond to the request for comments.

The spokesperson of the Chinese Embassy in the United States did not comment on the above plan, but stated that China firmly opposes the U.S. "implementing unilateral long-arm jurisdiction measures." The spokesperson emphasized that if the U.S. continues down the wrong path, China will "take decisive measures to protect its legitimate rights and interests."

In July this year, Siemens received notice that the Trump administration had lifted the ban on exporting chip design software to China. Photo

A U.S. official and three U.S. insiders said that the plan is not the only one being discussed as a retaliatory measure against China, but this plan will fulfill President Trump's earlier threats. He once said that the U.S. government would prohibit the export of "key software" by restricting the global transport of products containing U.S. software or produced using U.S. software.

On October 10, Trump had claimed on social media that he would impose an additional 100% tariff on Chinese goods imported into the United States, and start new export controls on "any and all key software" from November 1, but provided no further details.

According to the sources, the specific details of this measure were disclosed for the first time, and subsequent steps may not proceed. However, two of them warned that considering such controls indicates that the Trump administration is preparing to escalate trade confrontation with China, even though some within the government prefer a more moderate approach.

Reuters observed that upon the release of the above report, the U.S. stock market indices fell immediately, but later narrowed their losses. The S&P 500 closed down 0.5%, and the Nasdaq closed down about 1%.

One of the sources admitted that U.S. government officials might announce the measure to pressure China, but not implement it. The other two said that the Trump administration is still discussing more narrow policy proposals, since "almost everything is manufactured using U.S. software."

Emily Kilcrist, a former U.S. trade official and current member of the U.S. think tank "New America," said that software is a natural leverage point for the U.S. But she added that such controls are extremely difficult to implement and could backfire on the U.S. industry. "You want them to only put forward threats they will actually execute and stick to."

Reuters noted that this move could disrupt global trade with China, especially technology products, and if fully implemented, could harm the U.S. economy.

The report mentioned that the Biden administration had previously implemented similar restrictions. After the outbreak of the Russia-Ukraine conflict in 2022, the U.S. restricted the export of items produced worldwide using U.S. technology or software to Russia. However, Trump has implemented a series of tariff measures against China since January, but has been inconsistent in the use of export restrictions.

The report gave examples, saying that Trump first imposed strict new restrictions on chips from NVIDIA and AMD, but later canceled them. In May, the U.S. imposed new restrictions on chip design software and other items, but lifted them again in early July.

On the 20th, the U.S. and Australia signed a critical mineral agreement. Screenshot of the post

This April, President Trump raised the "tariff baton" globally, imposing so-called "reciprocal tariffs," and the tariff on China was once as high as 145%. Subsequently, China immediately took a series of precise countermeasures, implementing a series of key mineral export control measures.

The West felt "choked," and while hyping up the "rare earth shortage," they invested heavily in developing so-called "non-Chinese" supply chains. Among them, the U.S. government invested heavily in domestic mining, but capital avoided it due to uncertainty; the EU looked to the moon, and in September released a report proposing mining in space, which was criticized as impractical.

On October 9, the Ministry of Commerce of China announced a decision to implement export controls on technologies related to rare earths, stipulating that technologies and their carriers related to rare earth mining, smelting and separation, metal smelting, magnet material manufacturing, and recycling of rare earth secondary resources must not be exported without permission.

The Financial Times pointed out that China's new restrictive measures are similar to the U.S. "Foreign Direct Product Rule" (FDPR) export control system, which the U.S. uses to prevent third countries from exporting semiconductor-related products to China. Bloomberg News evaluated that at a time when the U.S. and China are about to sit down face-to-face for negotiations, China has demonstrated its trade influence.

Seeing this situation, the U.S. became restless and continued to take rash measures: issuing a series of tax increases, cutting off key software and components to China, but these threats faced joint opposition from various industries in the U.S.; developing alternative supply chains, including signing a U.S.-Australia mineral agreement, but international experts generally believe that it would take the U.S. 10 to 20 years to establish a safe and independent supply chain.

Regarding the recent U.S. trade threats against China, Foreign Ministry Spokesperson Guo Jia Kun responded on the 21st, stating that China's position on handling Sino-U.S. trade issues has always been consistent and clear. A tariff war or trade war does not benefit any party, and both sides should negotiate to resolve the issues on the basis of equality, respect, and mutual benefit.

This article is an exclusive article by Observer Net, and it is not allowed to be reprinted without authorization.

Original: https://www.toutiao.com/article/7564211494670320171/

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