China to appeal WTO charges against cut in rare earth exports

Category: WTO Sub-category: World Trade Organisation
Document type: news

30-Aug-2011 | 11:45 IST | Edited by: Abhishek Sikdar

China, the world's largest producer of rare earths said on Wednesday that it would appeal against a World Trade Organisation ruling that it illegally restricted exports of rare earth minerals including bauxite, coking coal, fluorspar, magnesium, manganese, silicon metal, silicon carbide, yellow phosphorus and zinc.

The WTO last month charged complaints on behalf of United States, European Union and Mexico against China that the latter had failed to abide by accession commitments when it imposed quotas and duties on several types of minerals citing that export quotas and duties were illegal and against the commitments China made when it joined the world trade body.

China's commerce ministry spokesman Shen Danyang however told journalists on Tuesday that China will appeal and maintain that its policies do not violate WTO rules.
The complainants argued that these rare minerals are key inputs for numerous products in the steel, aluminium and chemical sectors and any cut in supplies could lead to sharp spikes in world prices.

Previously this year Beijing also caused an international alarm after it tightened its grip over rare earths - 17 elements critical to making many high-tech products from iPods and wind turbines to missiles-- including cutting exports and hiking taxes.

China has claimed that its measures are in harmony with the objective of sustainable development promoted by the WTO and enhance the healthy development of the resource industry. In the wake of the ruling, Chinese media pointed out that the European Union and United States were acting out of self-interest. The state-run Xinhua's Economic Information Daily said the United States and Europe were seeking access to China's resources to meet the demands of their domestic industries, particularly the development needs of high-tech industries. It also advised that China should be "on guard" as some countries run after their own interests and "make better use of WTO rules to fight for its own lawful rights and interests".

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Rare Earth Minerals: Also know as rare earth elements or metals are a set of seventeen chemical elements in the periodic table. Despite their name, rare earth elements are relatively plentiful in the Earth's crust. However, because of their geochemical properties, rare earth elements are typically dispersed and not often found in concentrated and economically exploitable forms known as rare earth minerals. It was the very scarcity of these minerals (previously called "earths") that led to the term "rare earth".