USA vs. China: Power Competition Over Microchips and Rare Earth Elements
Businesses and governments increasingly recognize their significant dependence on specific raw materials and limited suppliers worldwide.
China dominates the global production and refinement of rare earth elements, which are essential for modern technologies like electric vehicles and renewable energy. Germany imports approximately 65% of its rare earth metals from China, with some metals showing dependencies up to 98%.
In spring 2025, China announced potential export controls on seven rare earth elements, raising concerns about supply chain vulnerability. This situation parallels Germany's previous gas dependency on Russia.
Western nations must develop alternative sourcing strategies, invest in domestic production, and establish new international partnerships to reduce reliance on single suppliers for critical resources.
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