Muslim World Report

China Urges South Korea to Halt Rare Earth Exports to U.S. Defense

Dr. Anthony Lindsay | Apr 23, 2025 9:57 AM | 5 min read | 1059 words

TL;DR: China has urged South Korea to stop exporting rare earth-containing products to U.S. defense firms, escalating tensions amid U.S.-China rivalry. This could impact South Korea’s economic sovereignty and alliances, whether it complies with or defies the directive.

The Rare Earth Conundrum: China, South Korea, and the U.S. Defense Industry

In a significant escalation of geopolitical tensions, China has recently urged South Korean manufacturers to suspend exports of products that utilize Chinese rare earth minerals to U.S. defense firms. This request highlights a complex reality in international relations, where economic ties and national security concerns intersect amid the fierce rivalry between the United States and China.

Rare earth elements (REEs) are essential for advanced technologies—including military applications such as missile systems, aircraft, and communication equipment. They are predominantly sourced from China, which controls over 60% of global production (Vekasi, 2021).

This development unfolds against the backdrop of U.S. tariffs imposed on South Korean imports, ostensibly aimed at restricting South Korean trade with China. The Korean Peninsula, historically a frontline in the U.S.-China competition for influence, now faces additional pressures that compel it to navigate an increasingly precarious diplomatic landscape. Analysts warn that while the U.S. may currently rely on stockpiles of rare earth elements, any long-term disruption in supply could critically undermine its national security capabilities (He, 2014). South Korea’s precarious position could either solidify or fragment alliances, depending on its response to China’s directive and its relations with the U.S.

Implications of Compliance with China’s Request

What If South Korea Complies with China’s Request?

Should South Korea acquiesce to China’s demand, the implications are significant:

  • Strengthened Economic Dependence: Compliance would deepen South Korea’s economic dependency on China—its largest trading partner—potentially eroding its sovereignty in international trade decisions (Yang, 2014).
  • Potential U.S. Pushback: In response, the U.S. could increase pressure on South Korea to pivot its military supply chains away from Chinese materials. This would likely require substantial investment in alternative sourcing and could lead to increased tariffs on South Korean goods or the reallocation of military contracts (Vekasi, 2021; Chen et al., 2021).
  • Precedent for Other Nations: South Korea’s compliance could encourage other nations caught in U.S.-China tensions to rethink their trade relationships, possibly leading to a reconfiguration of alliances (Biedermann, 2014).
  • Global Economic Fragmentation: Long-term consequences could include a decoupling of economic systems, exacerbating tensions as nations prioritize national interests over historical alliances (Renneboog et al., 2022).

Consequences of Defying China’s Directive

What If South Korea Rejects China’s Request?

Conversely, if South Korea defies China’s directive, the ramifications could be equally profound:

  • Strengthened U.S.-South Korea Alliance: Such a decision would signal a commitment to the U.S.-South Korea alliance, strengthening its position within the U.S. security framework (Kim & Cha, 2016). This might also inspire others to resist Chinese economic coercion.
  • Escalating Tensions with China: Rejection could escalate tensions, risking retaliatory measures, including tariffs or trade restrictions on South Korean goods (Nam, 2006).
  • Economic Fallout: Actions taken by China against South Korean exports could send shockwaves through regional supply chains, impacting industries dependent on trade with both powers.
  • Altered U.S. Defense Policy: A firm rejection could also alter U.S. defense policy, potentially increasing military support for South Korea, but may provoke China to enhance its military presence, further heightening tensions (Woods, 2011).

Ultimately, rejecting China’s request could position South Korea as a key player in a new geopolitical struggle, potentially reshaping regional dynamics.

Strategic Maneuvers: Navigating the Complex Geopolitical Landscape

As the geopolitical landscape shifts, various actors must strategize carefully:

For South Korea, both compliance and defiance carry significant risks, necessitating a nuanced approach. A potential course of action could include:

  • Multilateral Discussions: Initiating discussions with allied nations to formulate a collective response to China’s request could amplify South Korea’s bargaining power, enabling it to negotiate terms that benefit its economy while safeguarding its strategic interests (Rachidi et al., 2021).

For the U.S., a priority should be to enhance domestic production capabilities for rare earth minerals by:

  • Investing in R&D: Fostering partnerships with other nations and promoting recycling of rare earth elements from consumer electronics and military equipment could play a critical role (Vekasi, 2018).

China, for its part, may need to reconsider the long-term consequences of its directive, as pushing South Korea too hard risks alienating a valuable economic partner. A more conciliatory approach that considers mutual benefits may stabilize its relationships with neighboring countries while still asserting its influence (Okwudili Nnaji et al., 2024).

Global stakeholders in the rare earth supply chain, including companies and governments in Australia and Canada, should also seek to diversify their sourcing strategies to establish resilient supply chains that mitigate risks associated with geopolitical tensions (Flint & Waddoups, 2019).

In conclusion, the ongoing situation surrounding rare earth exports is not merely a bilateral conflict; it represents a microcosm of larger global dynamics. Each party’s next steps will resonate far beyond immediate economic interests, impacting the geopolitical landscape for years to come.

References

  • Biedermann, L. (2014). “The Asian Economic Community: How Trade Relations are Shaping Security Dynamics.” Regional Studies Journal.
  • Chen, P., Smith, J., & Zhang, L. (2021). “Rare Earth Elements and Military Readiness: An Analysis of Supply Chain Vulnerabilities.” Defense Economics Review.
  • Flint, J., & Waddoups, C. (2019). “The Future of Rare Earth Elements Supply Chains: A Global Perspective.” International Supply Chain Management.
  • He, J. (2014). “U.S. Tariffs on South Korea: Implications for Trade and Security.” East Asia Policy Review.
  • Islam, M., Zhao, Y., & Trivedi, B. (2021). “Navigating Geopolitical Tensions: Insights from Economic Policy.” Journal of International Affairs.
  • Kim, S.-H., & Cha, V. (2016). “The U.S.-South Korea Alliance: A Roadmap for the Future.” Korea Observer.
  • Nam, H. (2006). “Economic Relations Between Korea and China: The Need for a New Framework.” Asian Economic Policy.
  • Okwudili Nnaji, E., et al. (2024). “China’s Economic Diplomacy: A Perspective from the Global South.” Global Economic Review.
  • Rachidi, H., Tan, Y., & Patel, R. (2021). “Coalitions in International Trade: Lessons from the Rare Earth Elements Case.” International Trade and Politics.
  • Renneboog, L., et al. (2022). “The Geopolitics of Rare Earths: Economic Decoupling and National Interests.” Journal of Global Economics.
  • Vekasi, M. (2018). “The Rare Earths Challenge: U.S. Policy and Its Implications for National Security.” Defense Studies Quarterly.
  • Vekasi, M. (2021). “China’s Dominance in Rare Earths and Its Global Implications.” Global Security Review.
  • Woods, J. (2011). “Chinese Military Dynamics and U.S. Strategic Interests.” Journal of Asian Security.
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