European Commission President Ursula von der Leyen has warned that China's tightening of export restrictions on rare earth metals and battery materials poses a "great risk" to Europe and said Brussels is considering all options in response, including coordinating with G7 partners. "In recent weeks and months, China has significantly tightened export restrictions on rare metals and battery materials," von der Leyen said on Saturday in a speech at the Berlin Global Dialogue conference. "This development represents a great risk." In her most direct comments since China announced plans this month to curb rare earth exports, von der Leyen said the European Union is currently focused on finding solutions in cooperation with its Chinese partners. "But we are ready to use all the tools at our disposal to respond if necessary, and we will work with our G7 partners on a coordinated response," she added, according to Bloomberg. The remarks follow a call from French President Emmanuel Macron to use the EU's so-called "anti-coercion instrument" (ACI) against Beijing if a diplomatic solution cannot be found. The ACI, which has never been used, was designed as a deterrent to be deployed against deliberate coercive measures by third countries using trade to pressure the EU or its members. Von der Leyen warned that China's move on rare earths is part of a "broader economic friction" between the United States and China, but that it has a "significant impact" on Europe. She noted that 90% of the continent's consumption of rare earth magnets comes from China. Europe's concerns over Chinese trade restrictions have grown as the EU seeks to protect its industries from a flood of subsidised Chinese products. The 17 rare earth elements, 12 of which are now subject to export restrictions, are vital for products ranging from electric vehicles to jet engines and military radar. China produces about 90% of the world's processed rare earths and rare earth magnets. The heightened rhetoric comes after EU Trade Commissioner Maroš Šefčovič held talks with his Chinese counterpart, Wang Wentao, which failed to produce an agreement to address the bloc's concerns. "We have no interest in escalation," Šefčovič told reporters after the call on Tuesday. "However, this situation casts a shadow over our relationship, so a quick solution is essential." Šefčovič said the pace of communication would accelerate and that a Chinese team would visit Brussels to discuss the matter further.
