The Group of Seven (G7) nations, along with the European Union (EU), are contemplating the implementation of price floors and taxes on Chinese exports. This strategic move aims to stimulate the production of rare earth elements and reduce their dependency on China, according to a Reuters report citing insider sources. Except for Japan, the majority of G7 countries heavily depend on China for essential minerals, such as rare earth magnets and battery metals. In response, a Critical Minerals Action Plan was launched in June, with subsequent technical discussions held in Chicago this month.
"The core of the discussions was centered around potentially tightening regulations on foreign investments," noted one source, emphasizing the goal of deterring companies from shifting operations to China. Despite a consensus on strategy, there was division among members regarding a direct confrontation with Beijing. Proposed strategies include enforcing local content regulations and setting sourcing limits for procurement. A former Trump administration official indicated that the United States is contemplating broader measures to counter Chinese price dumping. Meanwhile, the concept of price floors supported by subsidies is under consideration; the U.S. is already implementing such measures, with Australia exploring similar strategies and Canada showing conceptual support.
