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Case 5. 3

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China Restriction of Rare Earth Materials

The act of China restraining exports of rare earth materials is a blow to the states that

depend on their production and distribution. China happens to be the major manufacturer, user and

investor of rare earth in the universe and it controls ninety-seven per cent of the universal supplies

(Hill and Hult). The gap between demand and supply is bound to grow because of the restrictions

on China's export and a shortage of supplies in other supplying states. With the limited supply, the

countries that are large users of rare earth in the manufacture of smartphones, hybrid cars, and

guided missiles will experience higher prices for the commodity. These industries are therefore

forced to look for alternative materials to replace the rare earth materials.

The introduction of export allowance on rare earth metals by China profited some groups

back home. The domestic economic development profited in the reduction of universal supply

because this lead to increase in the prices for importing countries. The Chinese domestic

manufacturers got a substantial cost advantage from the restriction because the little that they

exported earned them massive returns. Further, they are in a position to procure the rare earth

materials at low prices because they can access the raw materials locally regardless of the universal

hike in prices of the same. China will be in a position to put up high-tech companies which are

external and this will help in creating employment for their citizens as well as a source of revenue.

Additionally, China as a country benefited because it became an environmental protection mission

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as well (Gavin). There happen to exist maximized value and conservational standard considering

that the production of the rare earth metals contributes towards pollution.

The need for the rare earth metals in the universe is in a position of surpassing manufacture,

and states such as Australia, Canada, and the United States should reevaluate their conservation

limitations of their production. The massive production of the rare earth metal in China affects

their environment and the people who live there who get exposed to adverse effects of pollution

from the factories of the metals. Limitation of production of the metals should be done based on

the preservation of the environment while putting into consideration what will become of the state

if the trend continues. The consumers of the metals should be considerate of the welfare of the

people from where they import the products from and accept the restriction challenge.

The constraint of the rare earth metals means that those who use them in the production of

their products will have to look for substitutes. The rare metals play a vital role in the products and

replacing them with readily available materials means that their quality becomes interfered with

in one way or another. With this idea, it means that the consumers will become affected directly

as they purchase products that are not up to standard without knowing. Using substitute materials

is not the best solution because they will end up manufacturing products that do not meet the initial

quality that is required. The rare earth metals are used to manufacture crucial products like

vehicles, smartphones, laptops and even missiles and this means that altering the way they are

made could pose a danger to the users.

Conclusion

The restriction of exports of rare earth materials by china by introducing export measures

is a blow to states that depend on the products entirely. The fact that these countries will no longer

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Surname 1 Name Email Address Course Number Date China Restriction of Rare Earth Materials The act of China restraining exports of rare earth materials is a blow to the states that depend on their production and distribution. China happens to be the major manufacturer, user and investor of rare earth in the universe and it controls ninety-seven per cent of the universal supplies (Hill and Hult). The gap between demand and supply is bound to grow because of the restrictions on China's export and a shortage of supplies in other supplying states. With the limited supply, the countries that are large users of rare earth in the manufacture of smartphones, hybrid cars, and guided missiles will experience higher prices for the commodity. These industries are therefore forced to look for alternative materials to replace the rare earth materials. The introduction of export allowance on rare earth metals by China profited some groups back home. The domestic economic development profited in the reduction of universal supply because this lead to increase in the prices for importing countries. The Chinese domestic manufacturers got a substantial cost advantage from the restriction because the li ...
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