Rare earth metals backlash?
In trade battle with US, China may cut supplies; Hang Seng pops
Investors are watching for China’s next moves in the contest with the US over semiconductor trade with speculation China may restrict exports of rare earth metals.
“What’s going to happen sooner rather than later, China is going to choose to weaponize rare earths exports,” David Riedel, president of Riedel Research Group, told CNBC television on Monday.
Rare earths are used in everything from color TVs to aviation, defense, and industrial electronics. China is the world’s largest producer of rare earth metals accounting for 80 percent of the key materials. US ally Australia is second.
“They can simply hold the export of those rare earths and say, ‘Hey sure, you can have all the rare earths you want, but you have to build your factory in China’,” Riedel said.
Australian mining companies could benefit from the escalating trade war with China, including Lynas Rare Earths, Iluka Resources, Arufa Rare Earths, and Hastings Technology Metals. Lynas, the largest, is building a $120 million rare earths separation plant on the Gulf Coast of Texas for the US Department of Defense.
China stocks rise
The Hong Kong stock market popped more than 5 percent in Asia trading on Tuesday following an unconfirmed report on social media speculating China would ease its COVID travel ban by March.
China Foreign Ministry spokesman Zhao Lijian said he was “not aware of the situation you mentioned” in response to a media question about the social media post which had said China was forming a committee to assess border reopening.
The rise in China-related stocks is a reversal of earlier declines following the China Communist party’s national Congress and President Xi Jinping’s appointment to a precedent-breaking third term. Hopes China will phase out its zero-COVID policies prompted a global equities rally overnight, but US stocks sold off in early trading.
Shanghai import expo
The fifth China International Import Expo taking place in Shanghai from November 5 to 10 will feature representatives from 145 countries, the Xinhua news outlet reported.
“Sun Chenghai, deputy director of the CIIE Bureau, said at a press conference that 284 industry-leading enterprises, including some of the world's top 500 companies, will participate in this year's expo.”
China space station docking
China successfully docked a 23-ton module to its space station. Called Mengtian, meaning “Dreaming of the Heavens”, the module is designed for research on the effects of zero gravity and quantum technologies – a field China leads, according to the WSJ.
Uyghur rights at United Nations
Fifty countries have urged China in a United Nations letter to release hundreds of thousands of Uyghurs detained in camps in the western province of Xinjiang.
Monday’s statement from the 50 countries calls for “urgent attention” to findings of a UN report which is “an independent, authoritative assessment that relies extensively on China’s own records” and “makes an important contribution to the existing evidence of serious and systematic human rights violations in China,” the Associated Press reported.
The UN human rights office report, released on August 31, accuses China of “crimes against humanity.” The US State Department has concluded China is conducting a campaign of “genocide” against the predominantly Muslim population in Xinjiang.
‘Dystopian nightmare’ in Cambodia
The Los Angeles Times reports the “Cambodian government has given Chinese crime syndicates free rein to bring in tens of thousands of foreign men and women who —according to human rights organizations and their own accounts — are held captive to work in crowded cyber scam mills.”
F-22s replacing F-15s in Okinawa
The Pentagon is rotating F-22 stealth fighters into Okinawa to replace two squadrons of aging F-15s. The move has prompted handwringing about a structural lack of readiness in the US combat air fleet and the weak message that sends a more aggressive Chinese military. But the F-22s are a vastly more modern and capable weapons platform. In the short-term, at least, this can be seen as bulking up.
US-China-Russia Diplomacy
US Secretary of State Antony Blinken and China Foreign Minister Wang Yi spoke by telephone on Sunday, October 30, the two sides have said.
The pair discussed Russia's war against Ukraine and the threats it poses to global security and economic stability, according to State Department spokesperson Ned Price. Wang had spoken with Russia Foreign Minister Sergei Lavrov last week and warned Russia against any nuclear escalation in Ukraine will also hailing Beijing’s strategic partnership with Moscow.
After the call with Blinken, Wang said US should stop trying to contain China, according to Reuters. Washington should not let itself be blinded by ideological bias when dealing with China, Xinhua reported.
US officials are seeking to line up a one-on-one meeting between President Joe Biden and Xi on the sidelines of the upcoming G20 summit in Indonesia, November 15-16.