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China's rare-earth strategy versus US risks backfiring

As mineral prices rise, drive to build up American industry gains steam

China produces nearly 80% of the world's rare earths, used in high-tech products like smartphones and electric cars.   © Reuters

TOKYO/SHANGHAI -- China is looking to strengthen its dominance over the rare-earth minerals needed for myriad tech products, in part through regulations designed to promote high-end industries. In doing so, however, Beijing risks driving investment into the rare-earth industry of its trade war foe, the U.S.

China produces nearly 80% of global rare earths, used in a variety of products including smartphones and the motors of hybrid and electric vehicles. Amid concerns that Beijing is considering some form of export restrictions, prices of rare earths have jumped over the last few months.

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