from Greenberg Center for Geoeconomic Studies

Rare Earth Elements and National Security

October 17, 2014

Report

Overview

Eugene Gholz analyzes the economic and security consequences of China's central position in the global rare-earths market. He discusses the evolution of the rare-earths market, which is critical to many defense, energy, and other high-tech products, and potential vulnerabilities posed to global trade resulting from China's near-monopoly of the industry.

Eugene Gholz

Associate Professor, Lyndon B. Johnson School of Public Affairs, University of Texas at Austin

Gholz explains why the alleged 2010 Chinese embargo of the market, which highlighted the prominence of rare earths, did not exact a greater cost on countries with rare-earth dependent supply chains, such as Japan and the United States, citing supply growth opportunities and administrative difficulties, as well as real-time adjustments in the global market. Gholz also examines the evolution of Chinese influence since 2010, particularly in light of capital investment and technological advances that have made non-Chinese producers more competitive.

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China

Energy and Environment

Trade

Based on his analysis, Gholz provides lessons to policymakers facing future raw materials threats, arguing that dependence on imported rare-earth products brings less national security risk than many have feared.

More on:

China

Energy and Environment

Trade

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