Von der Leyen vows to strike back against China as EU feels rare earths squeeze

“In the short term, we are focusing on finding solutions with our Chinese counterparts. But we are ready to use all of the instruments in our toolbox to respond if needed. And we will work with our G7 partners on a coordinated response,” von der Leyen told the Berlin Global Dialogue conference.

She also announced a new plan to counter the choke on rare earths that she said would focus on recycling, joint purchasing, stockpiling and investment.

The speech comes amid a debate in the EU about whether the bloc should trigger its anti-coercion instrument – considered to be its most powerful trade weapon – against China for the controls, which have ground some production lines in Europe to a halt.

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China rebukes US for causing ‘unnecessary panic’ with remarks on rare earth controls

On Thursday, French President Emmanuel Macron urged other leaders to activate the instrument, known in Brussels as the “trade bazooka”, which could allow the EU to slap tariffs, quotas, export controls or market bans on Chinese firms in retaliation.

“The decisions announced by the Chinese government on October 9 pose a significant risk. In essence, these actions would severely hamper other countries from developing a rare earths industry,” von der Leyen said, referring to Beijing’s move to control the export of processing equipment for the minerals.

South China Morning Post