EU-China negotiations aim to calm rare earths and chip conflict
The European Union and China will meet in Brussels this week to address Beijing’s expanded export controls on rare earths and chip-related materials that EU officials say are disrupting European manufacturing.
EU and Chinese officials agreed to hold meetings in Brussels under their Export Control Dialogue after Beijing tightened rare-earth curbs on October 9, with Brussels seeking a prompt fix to protect sectors such as autos, aerospace, and semiconductors.
EU officials are working to ease tensions. European Commission spokesperson Olof Gill said a delegation of “high-level technical experts” from China is expected in Brussels on Thursday. He added that the EU is monitoring developments between the US and China while aiming to address the global disruptions caused by Chinese restrictions. European Trade Commissioner Maroš Šefčovič and China’s Commerce Minister Wang Wentao arranged the Brussels meetings during a two-hour call.
The sessions follow China’s decision to add several rare-earth elements to its export-control list and require licences for a wider set of products and technologies tied to magnets and chips. EU officials say the measures risk disrupting supplies for manufacturers across the bloc.
Discussions are expected to focus on licensing bottlenecks and the scope of restricted materials. The Commission noted that only about half of roughly 2,000 priority licence applications from EU firms have been processed so far. Broader trade frictions will also hang over the talks, including EU tariffs on Chinese electric vehicles and the Dutch seizure of Chinese-owned chipmaker Nexperia earlier this year. China accounts for most of the world’s rare-earth processing, making EU supply particularly sensitive to Beijing’s controls.
Beijing has steadily tightened oversight of strategic materials since 2023, adding reporting rules and curbs on gallium, germanium, graphite, tungsten, and other resources, while restricting the sale of related extraction and separation technologies. The latest expansion extended controls to additional rare-earth elements and products, prompting the EU to accelerate efforts to diversify sources and reduce reliance on Chinese supplies. Soon after, U.S. President Donald Trump vowed to impose 100% tariffs on China. Tensions have since eased as Trump and Chinese President Xi Jinping confirmed a meeting for October 30.
Global trade policy shifts have rippled through the markets. Following Trump’s tariff announcement, the crypto market - which trades around the clock - saw liquidations of $19 billion. Prices have since recovered, with investors closely watching further developments.
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