VIDEO: EU Trade Chief Pushes China on Rare Earths

On Thursday EU trade chief Karel De Gucht called for China to change its policy on rare earths after meeting with his Chinese counterpart, Commerce Minister Chen Deming.

China is where some 97 percent of rare earths are found. They’re crucial to global electronics, defense and renewable energy industries.

Chinese authorities angered trading partners by slashing rare earth export quotas by 35 percent for the first half of 2011.

That move choked off global supplies. Last week the World Trade Organization ruled that China breached trade law by curbing exports of eight raw materials.

Shortly after the meeting, China issued a new quota of rare earth exports for this year… making up for previous cuts… bringing China’s total export quotas for the year to 30,184 tons, down slightly from 30,258 tons in 2010.

EU trade chief Karel De Gucht says it’s too little, too late.

[Karel De Gucht, EU Trade Commissioner]:
“What industry needs is predictability. If they publish today the figures for the second semester, it’s certainly not too early. It’s rather too late. So, they should do that more in advance.”

In its raw materials ruling, the WTO panel said China’s domestic policies fell short of demonstrating that its export duties on the materials.

But De Gucht says he’s confident that a negotiated solution will be achieved.

[Karel De Gucht, EU Trade Commissioner]:
“They realize that they have to change their policy. Of course, this is not an easy file for them either. It has environmental ramifications but if that affects the production, then that should go not only for the export but it should also go for the internal consumption.”

China has taken steps to consolidate and rein in its polluting rare earths industry and De Gucht says China will likely appeal the WTO ruling.

 

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