U.S. Races to Reduce Dependence on China's Critical Minerals

(MENAFN) Washington is racing to break free from Beijing's stranglehold on critical mineral supplies through an ambitious new initiative that mobilizes both Wall Street capital and federal resources, according to media sources.

The program—christened Project Vault—will marshal private sector investment alongside a $10 billion credit line from the US Export-Import Bank to amass strategic reserves of rare-earth elements. These materials form the backbone of everything from consumer electronics and electric vehicles to cutting-edge military hardware. The reserve aims to insulate American manufacturers from supply shocks and wild price swings.

Over a dozen corporate giants, including General Motors, Boeing, and Alphabet's Google, have reportedly signed onto the undertaking, insiders told the outlet Monday.

China's market dominance remains staggering: the country controls more than 90% of worldwide rare-earth refining capacity and virtually all permanent magnet manufacturing, granting Beijing unparalleled leverage over supply networks essential to contemporary industry and national defense.

In April 2025, Beijing imposed export restrictions on select rare-earth materials deployed in defense applications, invoking national security justifications. Authorities subsequently tightened the screws with enhanced licensing mandates and extraterritorial clauses targeting shipments connected to American defense contractors and chip manufacturers. After Trump and Chinese President Xi Jinping met in South Korea last October, Beijing consented to pause the newest restrictions for twelve months in return for matching US tariff rollbacks. Yet even with this breathing room, Washington has pushed harder to broaden its sourcing network, inking agreements with Australia, Japan, Ukraine, and other nations.

Worldwide appetite for these strategic minerals has skyrocketed as economic rivalry intensifies between the planet's two preeminent powers. The International Energy Agency projects demand for materials like lithium and cobalt will explode thirtyfold by 2040, propelled by surging adoption of electric vehicles and energy storage infrastructure.

Moscow has also acted to consolidate its advantage. President Vladimir Putin has ordered his cabinet to craft a comprehensive blueprint for rare-earth extraction and processing. Russia claims deposits totaling an estimated 658 million tons of rare metals, including 28.5 million tons across 15 rare-earth varieties—stockpiles the Kremlin insists can satisfy the nation's long-term requirements.

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