World

Trump’s Trade Tussle: How the US Is Rallying Allies to Challenge China’s Supply Chain Dominance

US urges allies to diversify supply chains, citing China‘s control of rare earths in trade dispute.

October 15, 2025, 3:48 PM

United States President Donald Trump, wearing a blue suit and red tie, sits and gestures while speaking in a yellow armchair inside the White House.

President Donald Trump speaks during a meeting with a foreign leader in the White House. By noamgalai / Shutterstock.com.

Executive Summary

The Trump administration plans to collaborate with allies to gain a trade advantage over China, citing Beijing’s control over rare earth elements as evidence of an “unreliable partner.”

US Treasury Secretary Scott Bessent urged international partners to “de-risk and diversify our supply chains, away from China, as quickly as possible” due to China’s unreliability regarding rare earths.

These escalating trade countermeasures, including planned 100 percent tariffs on Chinese goods, precede a potential meeting between President Trump and Chinese President Xi Jinping at the upcoming Apec summit.

The Story So Far

Escalating trade tensions between the US and China are largely driven by the Trump administration’s concerns over Beijing’s control of rare earth elements, which it views as evidence of an “unreliable partner” jeopardizing global supply chains. This has prompted Washington to urge allies to “de-risk and diversify” their supply chains away from China and collaborate to gain leverage in trade negotiations, particularly in anticipation of a significant regional summit.

Why This Matters

The Trump administration’s push for allied cooperation to diversify supply chains away from China, citing Beijing’s control over rare earth elements, signals an escalation in trade tensions and a strategic effort to reshape global economic dependencies. This approach, coupled with potential 100 percent tariffs on Chinese goods, is poised to prompt significant shifts in international manufacturing and trade routes, potentially impacting global supply chain stability and consumer costs.

Who Thinks What?

The Trump administration, through US Treasury Secretary Scott Bessent, views China as an “unreliable partner” due to its control over rare earth elements, urging allies to “de-risk and diversify supply chains” away from China and imposing tariffs on Chinese goods.

China, through its actions such as controlling rare earth elements, is perceived by the US as jeopardizing global supply chains and acting unreliably, while maintaining a firm stance in ongoing trade tensions.

The Trump administration announced on Wednesday its intention to collaborate with allies to gain an advantage in trade negotiations with China, citing Beijing’s recent control over rare earth elements as evidence of an “unreliable partner” jeopardizing global supply chains. These statements from Washington underscore escalating trade tensions between the two economic powers, particularly ahead of a significant regional summit.

US Treasury Secretary Urges Supply Chain Diversification

US Treasury Secretary Scott Bessent, speaking at a press conference in Washington, emphasized the risks associated with dependency on China for rare earths. He characterized the situation as “China versus the world,” urging international partners to “de-risk and diversify our supply chains, away from China, as quickly as possible” if Beijing continues to act as an unreliable partner.

Bessent’s remarks come as both Washington and Beijing demonstrate firm stances ahead of a potential meeting between President Trump and Chinese President Xi Jinping. This anticipated discussion is slated to occur on the sidelines of the Asia-Pacific Economic Cooperation (Apec) summit, scheduled to commence at the end of October.

Escalating Trade Countermeasures

The administration’s latest comments are part of a series of countermeasures in the ongoing trade dispute. Officials previously declared plans to impose 100 percent tariffs on various Chinese goods starting November 1. Additionally, President Trump had suggested targeting specific sectors, such as cooking oil, as part of the retaliatory measures.

Outlook on US-China Trade Relations

The US government’s call for allied cooperation and supply chain diversification highlights its strategy to exert pressure on China regarding trade practices and rare earth controls. This approach signals a continued effort to reshape global economic dependencies and confront what it perceives as Beijing’s challenges to international commerce.