Tuesday, March 13, 2012

WASHINGTON

WASHINGTON: US President Barack Obama will Tuesday announce a new trade suit against China prompted by Beijing's restrictions on the export of rare earth materials used in manufacturing hi-tech products.

A senior White House official said on condition of anonymity that the United States would bring the case at the World Trade Organization with the European Union and Japan, in a new sign of election-year trade tensions with Beijing.
China is the world's largest producer of rare earths -- 17 elements critical to manufacturing a range of high-tech products from iPods to missiles -- and its moves to dictate production and exports have raised a global outcry.
Critics say Beijing's strategy is aimed at driving up global prices of the metals and forcing foreign firms to relocate to the vast emerging nation to access them.
But Beijing says the restrictions are necessary to conserve the highly sought natural resource, limit harm to the environment from excessive mining and meet domestic demand.
The Chinese government has set its 2012 export quota for rare earths at around 30,000 tonnes, the same level as 2011. However, exporters only filled roughly half the quota last year.
State media has already reported that China was bracing for renewed calls to ease its rare earths controls after the WTO ruled that limits on such key raw materials broke trade rules.
China has also called for greater use of rare earths for its own domestic manufacturing, a move which also raised concerns in the West.
Rare earth goods have a wide range of applications in the military and technology sectors of the economy in particular.
They are used in products including computers, MP3 players, disc drives, missiles and flat screen televisions and cellphones.
Obama, facing fierce election-year pressure on China from Republican opponents, has repeatedly called on Beijing play by the "rules of the road" as it rises to become one of the dominant players in the global economy.
View the original article here

Source from Channel News Asia

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