Beijing's Rare Earth Restriction Impact on South Korea

Beijing has urged South Korean firms to refrain from exporting products with China's rare earth minerals to U.S. defense companies. The warning comes amid China's recent export restrictions on rare earth elements, crucial in various industries, as a countermeasure to U.S. tariffs.

Beijing has instructed South Korean businesses not to export products containing China's rare earth minerals to U.S. defense contractors, according to sources cited by the Korea Economic Daily. The edict was communicated through letters from China's commerce ministry to firms involved in the production of vital equipment such as power transformers, batteries, and aerospace components.

These letters reportedly warned South Korean companies of potential sanctions if they disregard the export restrictions. As the restriction is part of China's broader strategy responding to U.S. tariffs, South Korea's Industry Ministry has yet to make a comment regarding the directive.

Earlier this month, China imposed export limits on rare earth elements as a comprehensive response to U.S. President Donald Trump's tariffs on Chinese goods. This action has squeezed supplies of these critical minerals required for manufacturing weapons, electronics, and many consumer products in the West.

(With inputs from agencies.)