US Initiates Strategy to Counter China's Control of Critical Minerals

Thu Feb 05 2026 14:19:12 GMT+0200 (Eastern European Standard Time)

In a significant move to diminish China's dominance in the critical minerals sector, the US has launched a comprehensive plan aimed at establishing a trade zone for essential minerals crucial for technology and defense industries.

The United States has introduced an initiative to form a cooperative trade zone for critical minerals amid growing concerns over China's overwhelming influence in this sector. The inaugural Critical Minerals Ministerial, held by the State Department, involved discussions among countries such as the UK, EU, Japan, and others focused on securing access to vital resources necessary for technology manufacturing. While the US seeks to mitigate reliance on Chinese resources, measures like tariffs and substantial investments in mining projects are also being considered to support domestic production and stability in global markets.

The US has launched an effort to form a trade zone for critical minerals that are key to making everything from smartphones to weapons as it tries to break China's dominance of the industry.

On Wednesday, the State Department hosted the first Critical Minerals Ministerial event - which was attended by countries and organisations including the UK, European Union, Japan, India, South Korea, Australia and the Democratic Republic of Congo.

Delegates discussed the availability of and access to minerals crucial to the manufacture of things like computer chips and electric vehicle batteries.

The mining and processing of such critical minerals, which include rare earths, is dominated by China.

In remarks released by the US government, Vice President JD Vance and Secretary of State Marco Rubio did not mention China by name. Instead, Vance referred to the foreign supply of such minerals flooding global markets, making it difficult for other countries with mineral deposits to secure the financing needed to produce them.

The US planned to use tariffs to stop critical mineral prices falling too low, which can deter investment, he said.

David Copley, a special assistant to President Donald Trump, said the US intends to deploy hundreds of billions of capital into the mining sector to get projects going.

Investments have already been made in several companies, including rare earths magnets maker MP Materials and Lithium Americas, which produces material key to rechargeable batteries, he said.

US Trade Representative Jamieson Greer also said that the US, Japan and the European Commission are developing coordinated trade policies and mechanisms in order to collectively avoid potential issues with access to important minerals.

Ahead of the meeting, a Chinese Foreign Ministry spokesperson said countries need to follow the principles of market economy and international economic and trade rules, step up communication and dialogue.

The event was part of a broader effort by the US government to counter China's ability to use its dominance of the industry as leverage in trade negotiations.

On Monday, Trump announced the creation of a critical mineral reserve, called Project Vault, worth almost $12bn (£8.8bn).

Industry figures welcomed the announcement.

It's critical to see the United States take decisive steps to shore up our supply of all kinds of minerals and rare earths, said Wade Senti, president of Advanced Magnet Lab.

Wednesday's event took place on the same day that Trump had a phone call with his Chinese counterpart Xi Jinping, which the US president described as very positive.

China has a chokehold on rare earths and has tightened its grip over exports in recent months.

Beijing requires companies in China to get government approval before shipping the minerals abroad.

When the curbs were tightened in October it dealt a major blow to the US, whose industries are heavily dependent on these imports.

The Chinese government soon eased those stricter measures but analysts say it is using its dominance as a key bargaining chip in trade talks with Washington.