Washington (AFP) – US President Donald Trump threatened on Friday to cancel an upcoming summit with Xi Jinping and hit China with “massive” tariffs after Beijing imposed export curbs on rare earth minerals. In an angry social media post that triggered a sell-off on the stock markets, Trump said China’s restrictions on materials used in almost every area of modern life were “very hostile.”
Trump said China had sent letters to countries around the world detailing export controls on “each and every element of production having to do with Rare Earths.” “There is no way that China should be allowed to hold the World ‘captive,'” he said on his Truth Social network. The US president called into question his plans to meet Xi at the Asia-Pacific Economic Cooperation (APEC) summit later this month, which was to be their first encounter since Trump returned to power in January. “I was to meet President Xi in two weeks, at APEC, in South Korea, but now there seems to be no reason to do so,” he said.
He also threatened sanctions that would reignite the trade war that has simmered between Washington and Beijing since his second term began. “One of the Policies that we are calculating at this moment is a massive increase of Tariffs on Chinese products coming into the United States of America,” he said. There was no immediate reaction from Beijing. But Trump’s sharp pivot sent Wall Street’s major indices sharply lower, with the Nasdaq down two percent in late morning trading. The dollar fell against its main rival currencies.
Rare earth elements are critical to manufacturing everything from smartphones and electric vehicles to military hardware and renewable energy technology. China dominates global production and processing of these materials. The US president said he did not understand why China was choosing to act now. “Some very strange things are happening in China! They are becoming very hostile,” he said.
Trump said other countries had contacted the United States expressing anger over China’s “great Trade hostility, which came out of nowhere.” He also accused Beijing of “lying in wait” despite what he characterized as six months of good relations, which has notably seen progress on bringing TikTok’s US operations under American control as required by a law passed by Congress last year. “Dependent on what China says about the hostile ‘order’ that they have just put out, I will be forced, as President of the United States of America, to financially counter their move,” Trump said.
His outburst comes just weeks after he had spoken of the importance of meeting Xi at the APEC summit and revealed that he would travel to China next year. Washington and Beijing engaged in a tit-for-tat tariffs war earlier this year that threatened to effectively halt trade between the world’s two largest economies. Both sides eventually agreed to de-escalate tensions, but the truce has been shaky.
Trump said last week that he would push Xi on US soybean purchases as American farmers, a key voting demographic in his 2024 election win, grapple with fallout from his trade wars. China had said earlier Friday that it would impose “special port fees” on ships operated by and built in the United States after Washington announced charges for Chinese-linked ships in April. In a further development, the US communications watchdog said it had successfully managed to get “millions” of listings for banned Chinese items removed from commerce platforms. “The Communist Party of China is engaged in a multi-prong effort to insert insecure devices into Americans’ homes and businesses,” Brendan Carr, head of the Federal Communications Commission, said on X.
© 2024 AFP
