Breaking News Gives Rise to Breaking Mineral Monopolies: China Ordered to Dismantle Export Taxes & Quotas
The breaking news today is that the appeals panel of the World Trade Organization (WTO) has ruled that that China must dismantle its framework of export taxes and quotas for nine extensively used industrial materials. This could ultimately set a precedent for the West to challenge China’s restrictive export policies on other natural resources -- namely rare earths.
The Appellate Body, the WTO’s highest tribunal, has ruled that dozens of China’s export policies for bauxite, zinc, yellow phosphorus and six other industrial minerals have ultimately distorted and harmed international trade. The key upshot of this news is that it bodes well for the global rare earths market outside of China. China will likely adhere to this ruling as non-compliance will curtail its access to international buyers, access it gets from the WTO.
The US, the EU and Mexico have claimed that China is using export taxes as well as quotas to influence global chemical companies to relocated operations to China to gain access to these resources. Though rare earths are not included in this most recent ruling, it leaves ground fertile for the inclusion of rare earths in future rulings. China has staunchly claimed that it can charge export taxes and limit exports in an effort to conserve a scarce natural resource or to protect the environment; it’s a legal exception that was extended under the General Agreement on Tariffs and Trade (GATT), the agreement that lead to the creation of the WTO.
Things couldn’t be moving in a more exciting direction for the Technology Metals Summit less than 48-hours away. For those of you that have already registered for the TMS, it seems that the world is conspiring in a good way and that the timing of the conference couldn’t be better based on the flurry of activity the rare earths markets are seeing and based on the volume of media coverage rare earths have been garnering of late. For those of you that are still debating whether or not to attend, visit www.TechnologyMetalsSummit.com and register already…
