China has secured a significant diplomatic win with its agreement to allow the export of rare earths to the United States. The deal marks a breakthrough in U.S.-China talks and highlights Beijing’s tight grip on this crucial sector. With China producing roughly 60% of the world’s rare earth supply, the country’s economic advantage over other nations has enabled it to maintain control.
The Chinese rare-earth industry experienced rapid growth following China’s opening up to the market in 1978. Government support for research and development helped establish Chinese companies as major players in the global market. Today, Beijing’s influence extends beyond trade to diplomatic channels, where the export of rare earths serves as a tool of statecraft.
Thailand, which is close to the United States but increasingly leans towards China, may be affected by this deal. Thailand’s prime minister, who has attempted to improve ties with China, faces an uncertain future after her suspension. The country’s stance on this issue could impact regional dynamics and further entrench Beijing’s influence in Southeast Asia.
The Dalai Lama is also expected to address his succession plans this week, sparking tension between the spiritual leader and China, which claims ownership of Tibet. This issue has historical roots dating back to the Qing empire, but the current situation highlights the complex nature of the relationship between China and the Tibetan people.
Overall, China’s diplomatic efforts demonstrate its strategic thinking on the global stage. The country’s control over rare earths and other key resources will likely remain a significant factor in international relations for years to come.
Source: https://foreignpolicy.com/2025/07/01/china-united-states-rare-earths-trade-deal-agreement