How China has relocated its most polluting mines to war-torn Myanmar
The acid dissolves the soil before being collected in metal basins, closely monitored in the summer heat by a handful of employees. This is where the metals essential for most cars, smartphones or missile guidance systems are extracted: rare earth elements. These are the materials Beijing now uses as leverage in the high-stakes game of global trade relations and are at the heart of what promises to be a tense summit between China and the European Union on Thursday, July 24.
Jiangxi, a rural province in southern China, is the global center of production for some of these metals, specifically the "heavy" rare earth elements, named for their higher atomic mass. These seven elements, such as terbium and dysprosium, have seen their exports sharply restricted by Beijing since April, resulting in shutdowns of Suzuki assembly lines in Japan, Ford in the United States and several European suppliers.
One extracted from the mines, the rare earth metals are transported to the regional city of Ganzhou, where they are refined and mixed with other metals, to produce products such as magnets that possess unmatched magnetic properties. Today, China holds a near-monopoly on the refining and transformation of rare earths into magnets, controlling 90% of the global market.
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Euronews
21 minutes ago
- Euronews
US-EU trade deal wards off tariff escalation but threatens growth
US President Donald Trump and European Commission President Ursula von der Leyen have announced a sweeping trade deal that imposes 15% tariffs on most European goods, warding off Trump's threat of a 30% rate if no deal had been reached by 1 August. The tariffs, or import taxes, paid when Americans buy European products could raise prices for US consumers and dent profits for European companies and their partners who bring goods into the country. Here are some things to know about the deal: Unresolved details Trump and von der Leyen's announcement, made during Trump's visit to one of his golf courses in Scotland, leaves many crucial details to be filled in. The headline figure is a 15% tariff rate on about 70% of European goods brought into the US, including cars, computer chips and pharmaceuticals. It's lower than the 20% that Trump initially proposed, and lower than his threats of 50% and then 30%. The remaining 30% of goods are still open to further decisions and negotiations. Von der Leyen said that the two sides agreed on zero tariffs on both sides for a range of 'strategic' goods: Aircraft and aircraft parts, certain chemicals, semiconductor equipment, certain agricultural products and some natural resources and critical raw materials. Specifics were lacking. She said that the two sides 'would keep working' to add more products to the list. Additionally, companies in the European Union would purchase what Trump said was $750 billion (€638bn) worth of natural gas, oil and nuclear fuel over three years to replace Russian energy supplies that Europe is seeking to exit anyway. Meanwhile, European companies would invest an additional $600bn (€511bn) in the US under a political commitment that isn't legally binding, officials said. Not yet in writing Brussels and Washington will shortly issue a joint statement that frames the deal but isn't yet legally binding, according to senior officials who weren't authorised to be publicly named according to European Commission policy. The joint statement will have "some very precise commitments and others that will need to be spelled out in different ways', a senior European Commission official said. EU officials said that the zero tariff list could include nuts, pet food, dairy products and seafood. Steel tariff remains Trump said that the 50% US tariff on imported steel would remain. Von der Leyen said that the two sides agreed to further negotiations to fight a global steel glut, reduce tariffs and establish import quotas — that is, set amounts that can be imported, often at a lower rate or tariff-free. Trump said that pharmaceuticals, a major import from the EU to the US, weren't included in the deal. Von der Leyen said that the pharmaceuticals issue was 'on a separate sheet of paper' from Sunday's deal. And von der Leyen said that when it came to farm products, the EU side made clear that 'there were tariffs that could not be lowered,' without specifying which products. 'Best we could do' The 15% rate removes Trump's threat of a 30% tariff. But it effectively raises the tariff on EU goods from 1.2% last year to 17% and would reduce the 27-nation bloc's gross domestic product by 0.5%, said Jack Allen-Reynolds, deputy chief eurozone economist at Capital Economics. Higher tariffs, or import taxes, on European goods mean sellers in the US would have to either increase prices for consumers — risking loss of market share — or swallow the added cost in terms of lower profits. The higher tariffs are expected to hurt export earnings for European firms and slow the economy. Von der Leyen said that the 15% rate was 'the best we could do' and credited the deal with maintaining access to the US market, and providing 'stability and predictability for companies on both sides'. Mixed reaction German Chancellor Friedrich Merz welcomed the deal which avoided 'an unnecessary escalation in trans-Atlantic trade relations" and said that 'we were able to preserve our core interests', while adding that 'I would have very much wished for further relief in trans-Atlantic trade'. Senior French officials on Monday criticised the accord. Strategy Commissioner Clément Beaune said that the deal failed to reflect the bloc's economic strength. 'This is an unequal and unbalanced agreement," he said. "Europe didn't wield its strength. We are the world's leading trading power.' While the rate is lower than threatened, "the big caveat to today's deal is that there is nothing on paper, yet," said Carsten Brzeski, global chief of macro at ING bank. 'With this disclaimer in mind and at face value, the agreement would clearly bring an end to the uncertainty of recent months. An escalation of the US-EU trade tensions would have been a severe risk for the global economy," Brzeski said. 'This risk seems to have been avoided.' Car prices Asked if European carmakers could still profitably sell cars at 15%, von der Leyen said the rate was much lower than the current 27.5%. That has been the rate under Trump's 25% tariff on cars from all countries, plus the pre-existing US car tariff of 2.5%. The impact is likely to be substantial on some companies, given that automaker Volkswagen said that it suffered a €1.3bn hit to profits in the first half of the year from the higher tariffs. Mercedes-Benz dealers in the US have said they were holding the line on 2025 model year prices 'until further notice'. The German automaker has a partial tariff shield, because it makes 35% of the Mercedes-Benz vehicles sold in the US in Tuscaloosa, Alabama, but the company said that it expects prices to undergo 'significant increases' in coming years. The EU also agreed to lower its tariff on cars imported from the US to 2.5% from 10%. Trade gap Before Trump returned to office, the US and the EU maintained generally low tariff levels in what is the largest bilateral trading relationship in the world, with around €1.7 trillion in annual trade. Together the US and the EU have 44% of the global economy. The US rate averaged 1.47% for European goods, while the EU has averaged 1.35% for American products, according to the Bruegel think tank in Brussels. Trump has complained about the EU's €198bn trade surplus in goods, which shows Americans buy more from European businesses than the other way around, and has said that the European market isn't open enough for US-made cars. However, American companies fill some of the trade gap by outselling the EU when it comes to services such as cloud computing, travel bookings and legal and financial services. And about 30% of European imports are from American-owned companies, according to the European Central Bank.
Euronews
2 hours ago
- Euronews
EU-US trade deal will come with consequences, German industries warn
While European Commission President Ursula von der Leyen praised a trade agreement signed between the EU and US on Sunday as a stabilising factor "in uncertain times," representatives of the German economy have expressed concern. Von der Leyen and US President Donald Trump struck a tentative trade deal to avert a potentially devastating tariff war between two of the world's largest economies on Sunday. The majority of EU exports bound for the US will be subject to a 15% tariff. According to a statement made by von der Leyen, this also includes billions of euros in EU investments in the US, as well as the purchase of defence equipment. Tariffs of 15% will now apply to car exports to the US, compared to the previously announced 25%. Import duties on steel are to remain unchanged at 50%. The German economy can breathe a sigh of relief for the time being, according to Managing Director of the German Chamber of Industry and Commerce Helena Melnikov. Melnikov said that worse has been prevented, however, "the deal has its price, and this price is also at the expense of the German and European economies." Wolfgang Niedermark from the Federation of German Industries was more critical. He stated that even a tariff rate of 15% would have an "immense negative impact" on Germany's export-oriented industry. The Federal Association of Wholesale, Foreign Trade and Service also spoke of a "painful compromise" and warned that supply chains would change and prices would rise, saying the deal will cost Germany growth, prosperity and jobs. Federal Chancellor Friedrich Merz, who was satisfied with Sunday's agreement, wrote on X that the deal showed it was possible to "avert a trade conflict". However, a review of Trump's actions to date raises doubts about the reliability of the agreement and the US president's words. In an interview with the Funke media group, Michael Hüther, director of the Institute for the German Economy, said that concerns remained as Trump had never completely taken tariff threats off the table.
Euronews
5 hours ago
- Euronews
Von der Leyen and Trump strike EU-US deal with 15% tariff for the bloc
The European Union and the United States have struck a tentative trade deal to avert a potentially devastating tariff war between two of the world's largest economies, capping a race against time before a self-imposed deadline of 1 August. Under the agreed terms, finalised on Sunday by European Commission President Ursula von der Leyen and US President Donald Trump during a meeting in Scotland, the majority of EU exports bound for the American market will be subject to a 15% tariff. The tariff for US exports bound for the EU market was not immediately clear. The deal is preliminary and needs to be further fleshed out. "I think it's great we made a deal today instead of playing games," Trump said at the end of the meeting. "I think it's the biggest deal ever made." "It's a big deal. It's a huge deal," von der Leyen said. "It will bring stability, it will bring predictability. That's very important for businesses on both sides of the Atlantic." Von der Leyen noted the 15% tariff would be "across-the-board" and "all-inclusive", blocking the application of other duties. "It was tough negotiations (but) we came to a good conclusion," she said, highlighting the "openness" of the EU market, which Trump had vehemently challenged. Both leaders shook hands to applause in the room. "We were able to make a deal that's satisfactory to both sides, so it's a very powerful deal. It's the biggest of all the deals," Trump said. The 15% rate is lower than the 20% rate that Trump imposed, and later paused, in April as part of his contentious, self-styled "reciprocal tariffs", as well as the 30% rate that he threatened to slap in a letter sent to von der Leyen earlier this month. The 15% rate is also inferior to the rates that other countries have negotiated with the White House in recent days, including Indonesia (19%) and the Philippines (19%), and matches the number granted to Japan (15%), a G7 ally. Still, it represents a painful concession, considering the talks began with von der Leyen offering a "zero-for-zero" tariff agreement. Through the back-and-forth process, von der Leyen repeatedly warned that "all options", including a never-used instrument against economic coercion, were on the table in case of an undesirable scenario. As tensions mounted, the European Commission prepared several lists of retaliatory measures against US products worth €93 billion in total. Brussels never resorted to any tit-for-tat measure due to stark differences between member states. Some countries, like France and Spain, advocated a show of force against Washington, while others, like Germany and Italy, pushed for a quick deal. The ideological gap closed after Trump made his out-of-the-blue 30% threat, which prompted outrage across the bloc and hardened the mood towards retaliation. The end of the story? Before Trump's arrival disrupted transatlantic commerce, EU-made products were subject to an average tariff rate of 4.8% upon entering US territory. Sunday's deal presumably entails an additional 10% to reach the 15% mark. EU cars, which are today under a 27.5% tariff, will be brought under the 15% rate. A "zero-for-zero" scheme will apply to aircraft and related components, semiconductor equipment, critical raw materials and some chemical and agricultural products. "We will keep working to add more products to this list," von der Leyen said. Additionally, she explained, the bloc commits to spending over $250 billion per year on purchasing American liquefied natural gas (LNG), oil and nuclear fuels to replace Russian energy. The total pledge will amount to about $700 billion by the end of Trump's term. Asked about what concessions, if any, the US had made in the talks, the Commission chief replied with a general remark about shared prosperity. "The starting point was an imbalance, a surplus (of goods) on our side and a deficit on the US side. We wanted to rebalance the trade relation, and we wanted to do it in a way that trade goes on between the two of us across the Atlantic," she said. "I think it's going to be great for both parties," Trump said. Sunday's meeting in Scotland took place amid sky-high expectations due to the looming deadline of 1 August that Trump had imposed to force nations to either offer far-reaching concessions or face punishing tariffs. Von der Leyen was accompanied by Maroš Šefčovič, the European Commissioner for Trade, who has been travelling across the two sides of the Atlantic Ocean in an attempt to gain a better understanding of the White House's maximalist demands. She was also joined by her powerful chef de cabinet, Björn Seibert; her trade advisor, Tomas Baert, and the Commission's director general for trade, Sabine Weyand. In the last stretch of negotiations, von der Leyen's team had realised that 15% was the lowest number that Trump was willing to settle for. The 15% rate was considered high for the bloc but palatable if paired with carve-outs for strategic sectors. A major concern along the way has been pharmaceuticals, which the EU exports in large volumes to the American market. The White House has opened a formal investigation into pharma products, a step that can pave the way for a tailor-made tariff. At the start of the meeting, Trump said pharma would be excluded from the deal. "We have to have them built and made in the United States, and we want them made in the United States," Trump told reporters. "Pharmaceuticals are very special. We can't be in a position where (...) we're relying on other countries." At the end of the meeting, von der Leyen said EU-made drugs would fall under the 15% rate but admitted Trump could take further action to address the matter "globally". "15% is certainly a challenge for some, but we should not forget that it keeps us access to the American market," she admitted, noting the bloc would continue to diversify its trade partners to create greater opportunities for European exporters and investors. The saga might soon take another twist: next week, a federal appeals court in the US will begin hearing arguments in a closely-watched lawsuit challenging Trump's authority to slap across-the-board tariffs under the pretext of a national emergency. This article has been updated with more information.
