China curbs dual-use exports to 10 US defense firms, including the rare-earth miners Washington backs
Beijing's new export-control list answers the Pentagon's China blacklist and pointedly names the two US rare-earth miners Washington is funding to break China's grip on the minerals.
Beijing's new export-control list answers the Pentagon's China blacklist and pointedly names the two US rare-earth miners Washington is funding to break China's grip on the minerals.
China's Commerce Ministry put 10 US firms on its export-control list on June 22, barring Chinese suppliers from selling them any dual-use items made in China, AP reported. The ministry said the step answered "the US government's egregious act" of expanding its list of companies it accuses of aiding China's military.
The 10 named firms include rare-earth miners MP Materials and USA Rare Earth, drone makers Teal Drones and Jaia Robotics, electronics maker Aveox, Ball Aerospace and Oshkosh Defense, CNBC reported. In a separate move, China's Finance Ministry barred 46 US companies, most of them defense contractors, from government procurement, exempting their China-registered, foreign-funded units.
MP Materials and USA Rare Earth sit at the center of Washington's drive to build a domestic rare-earth supply chain, the Straits Times noted, which called the package a "calibrated" response. China controls most of the world's processing of the magnets that go into US missiles, fighters and drones, and the list names the two miners trying to build an alternative.
The trigger was the Pentagon's 1260H list, expanded this month to add Alibaba, Baidu and BYD, CNA reported. That designation bars the Defense Department from awarding direct contracts to listed firms starting June 30.
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Subscribe Free →Analysts read the countermeasures as mostly a signal. Most of the targeted firms have "little or no meaningful business exposure in China," Han Shen Lin of The Asia Group told CNBC. The 1260H contract bar takes effect June 30, the next marker in a decoupling that now runs through the supply chain for both sides' weapons.
Frequently Asked Questions
What did China do on June 22?
China's Commerce Ministry added 10 US firms to its export-control list, barring Chinese suppliers from selling them dual-use items made in China, and the Finance Ministry barred 46 US companies from government procurement, according to AP and CNBC.
Which US firms were named?
The export-control list includes rare-earth miners MP Materials and USA Rare Earth, drone makers Teal Drones and Jaia Robotics, electronics maker Aveox, Ball Aerospace and Oshkosh Defense, CNBC reported.
Why target MP Materials and USA Rare Earth?
Both sit at the center of Washington's effort to build a domestic rare-earth supply chain, the Straits Times noted. China controls most global processing of the magnets used in US missiles, fighters and drones.
What set off the retaliation?
The Pentagon expanded its 1260H list of companies it says aid China's military this month, adding firms including Alibaba, Baidu and BYD, CNA reported. China's Commerce Ministry called the US action "egregious."
How significant is the move?
Analysts called it largely symbolic. Han Shen Lin of The Asia Group told CNBC most targeted firms have "little or no meaningful business exposure in China," and the Straits Times described the package as "calibrated."
AI-generated summary, reviewed by an editor. More on our AI guidelines.
Marcus Schuler
Marcus Schuler edits BattlePolicy, a daily defense-technology brief connecting the companies and capabilities behind modern war to the contest among Europe, the US, Russia, and China.