World

EU Weighs Countermeasures Against China’s Rare Earth Curbs, Signaling Escalating Trade Tensions

EU considers countermeasures after China‘s rare earth export curbs, seeking solutions.

byAndres Castro

October 22, 2025, 5:14 PM

Various piles of raw ore, processed metals, and mineral concentrates from a rare earth mine.

Piles of valuable minerals and ores from a rare earth mine. By Rebel Red Runner / Shutterstock.com.

Executive Summary

The European Commission is considering countermeasures in response to China’s continued restrictions on rare earth exports.

Rare earths are critical for high-tech industries, and the EU aims to diversify its supply to reduce reliance on China’s dominant position.

EU trade chief Maros Sefcovic is scheduled to meet with Chinese authorities to seek urgent solutions regarding rare earth exports.

The Story So Far

The European Union is considering countermeasures against China’s restrictions on rare earth exports because these 17 metallic elements are strategically vital for numerous high-tech industries, including electric vehicles and military equipment. China currently dominates the global supply chain for these critical raw materials, and the EU is actively seeking to diversify its sources and reduce its significant reliance on China to secure access.

Why This Matters

The European Union’s consideration of countermeasures against China’s rare earth export restrictions signals an escalation in trade tensions, driven by Europe’s critical need to secure access to these essential materials for high-tech industries, from electric vehicles to military equipment. This strategic move underscores a broader global trend among major powers to diversify supply chains and reduce reliance on single sources, potentially leading to significant shifts in international trade dynamics and increased costs for industries dependent on rare earths.

Who Thinks What?

The European Commission, through economy commissioner Valdis Dombrovskis, views China’s continued tight control over rare earth exports as a serious concern and is examining possible countermeasures while seeking urgent solutions and coordinating with international partners to secure access to these critical materials.

China is maintaining and expanding tight control over rare earth shipments, despite a July agreement, indicating a strategic management of its dominant global supply of these essential elements.

The European Commission is actively considering countermeasures in response to China’s restrictions on rare earth exports, according to EU economy commissioner Valdis Dombrovskis. This development follows China’s continued tight control over rare earth shipments and expanded curbs announced earlier this month, despite a July agreement intended to expedite exports to Europe.

EU Response to Export Curbs

Dombrovskis stated in an interview with Handelsblatt that the Commission is “examining possible countermeasures if conditions do not improve,” though specific instruments have not yet been named. He also noted ongoing coordination with international partners, including discussions at the G7 finance ministers’ meeting in Washington.

EU trade chief Maros Sefcovic is scheduled to meet with Chinese authorities in the coming days to seek “urgent” solutions for rare earth exports. The EU’s concerns highlight the strategic importance of rare earths, which are critical for various high-tech industries.

Background on Rare Earths and EU-China Relations

Rare earths are a group of 17 metallic elements essential for manufacturing everything from electric vehicles and wind turbines to smartphones and military equipment. China currently dominates the global supply chain for these materials.

The EU has been seeking to diversify its rare earth supply and reduce reliance on China. The ongoing discussions and potential countermeasures underscore the growing tension in trade relations, as the EU aims to secure its access to critical raw materials.

Other EU Developments

In related news, EU countries have approved a 19th package of sanctions against Russia for its war against Ukraine. This package includes a ban on Russian liquefied natural gas (LNG) imports, as announced by the Danish rotating presidency of the EU.

Meanwhile, the United States is reportedly considering its own curbs on exports to China, specifically targeting products made with U.S. software. These separate but concurrent developments illustrate a broader trend of geopolitical and economic recalibration among major global powers.