Article Summary: China lost in a disagreement that took place at the World Trade Organization which was about restrictions on uncommon metals and earth exports, thus resulting in Europe and the States winning as to what they see as Beijing’s biased trade exercises.
"Today's ruling by the WTO on rare earth shows that no one country can hoard its raw materials from the global market place at the expense of its other WTO partners," quoted by EU Trade Administrator Karel De Gucht.
China creates around 90% of the world’s uncommon earths, which are key factors in defense industry mechanisms and most up to date technology such as iPhones, disk drivers, and wind turbines. China executed firm exceptional earth export measures in 2010, which they said they were just trying to limit contamination and save resources.
The best of the best supplies climbed by hundreds of percent, in which, Japan, European Union, and the United States protested that the export limitations provided Chinese corporations an imbalanced competitive advantage. China stated that their limits on exports of these rare earths were desired to avoid over-mining., which also included the metals molybdenum and tungsten.
There is an increasing demand for rare earths. Car manufactures such as Toyota and Nissan which make electric hybrid cars use them; also smart companies such as Apple and Blackberry are in need of these metals for their smart phone devices and personal tablets. It is estimated that companies using rare earths contribute to more than $300 billion to the U.S. economy. Stocks of businesses exploring or mining for new bases of rare earths climbed in 2010 on assumption that China’s limits would increase mandate for alternate sources, although a decrease in prices as new supply has come up from Australia has become a hardship on manufacturers such as Molycorp Inc.
Personal Summary: I believe the China should not be allowed to restrict or put any limits on rare earths. These are very important metals that should be exported throughout the world for companies to purchase for the creation of their merchandise. The article summary speaks volumes when states, these companies using these rare earths contribute more than $300 billion to the U.S. economy. That is huge. These are the corporations that keep our financial industry can economy going. This goes along with chapter 6 in the book, International Trade. A question that does come to mind about this article is, why would China want to decrease the export of rare earths to other countries? Is it because they would make more of a profit by using them right there in their own territory? I do not think that would necessarily be true. Although, I do see where they would want to control the exports of their own country, yet I think these metals are such a valuable, it is important to continue the export to the other paying customers.
Article: China loses trade dispute over rare earth exports
BY TOM MILES AND KRISTA HUGHES
GENEVA/WASHINGTON Wed Mar 26, 2014 11:51am EDT
(Reuters) - China has lost a dispute at the World Trade Organization over limits on rare earth and metals exports, handing Europe and the United States a victory over what they see as Beijing's unfair trade practices.
"Today's ruling by the WTO on rare earth shows that no one country can hoard its raw materials from the global market place at the expense of its other WTO partners," said EU Trade Commissioner Karel De Gucht.
China produces more than 90 percent of the world's rare earths, key elements in defense industry components and modern technology from iPhones and disk drives to wind turbines.
China imposed strict rare earth export quotas in 2010, saying it was trying to curtail pollution and preserve resources.
Prices of the prized commodities soared by hundreds of percent, and the United States, European Union and Japan complained that the export restrictions gave Chinese companies an unfair competitive edge.