China blocks exports of rare earth elements, which are used in chips, to all countries

China has imposed a total ban on the export of rare earth elements not only to the US but also to other countries.

Here's What We Know

The decision was in response to the tariffs imposed by the Trump administration on 2 April, which were announced in honour of "Emancipation Day". In response, on 4 April, China imposed its own duties and export controls on key rare earth minerals and magnets made from them.

According to the data, exports now require special licences, but a system for issuing them has yet to be established, which has led to a complete halt in shipments. Chinese customs authorities are blocking exports to all destinations, including the US, Japan and Germany. China's Ministry of Commerce, together with the General Administration of Customs, has banned Chinese companies from dealing with US firms, especially defence contractors.

China dominates the global market for rare earth elements, which are critical to the automotive, aerospace, defence and chip industries. Although rare earth elements make up a small share of China's exports, their absence has a significant impact on trading partners.

Source: Fortune