Top officials from the United States and China met for a second day on Tuesday in London to tackle escalating tensions over export controls, focusing heavily on rare earth materials crucial for global supply chains. The talks, held at Lancaster House, aim to resolve conflicts that risk disrupting industries and slowing economic growth.
Following initial discussions on Monday, both sides are trying to smooth out differences from a provisional trade agreement reached last month in Geneva. China’s recent 34.5% drop in exports to the US in May—the steepest since early 2020—adds urgency to the negotiations, though immediate inflation and job market effects remain limited.
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The US delegation, led by Treasury Secretary Scott Bessent, Commerce Secretary Howard Lutnick, and Trade Representative Jamieson Greer, highlights the focus on rare earth magnets, vital for electric vehicles, aerospace, and advanced manufacturing. China, represented by Vice Premier He Lifeng, is a near-monopoly holder of these materials, making the talks critical.
The current dialogue follows a phone call between Presidents Trump and Xi Jinping, during which China agreed to resume rare earth exports to American companies. Despite temporary export licenses granted to major US automakers, industry watchers remain cautious amid ongoing political uncertainties.
The outcome of these talks will be closely monitored globally, as rare earth materials play an essential role in clean energy technologies and defense systems.
