Highlights

• China's new white paper uses diplomatic language to frame export controls as responsible governance, while omitting how these same tools restricted global access to gallium, germanium, and rare earths during 2023-2025 geopolitical tensions.
• Beijing holds 85-90% of rare earth refining capacity and has weaponized licensing regimes as leverage—this document signals continued strategic dominance, not a policy shift.
• Investors should view this as narrative positioning: China's processing chokepoint remains intact until separation and metallization capacity meaningfully diversifies outside Chinese control.

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China’s State Council Information Office's latest white paper (opens in a new tab) on Arms Control, Disarmament, and Nonproliferation in the New Era lands with polished diplomatic language—cooperation, fairness, peaceful development. But in the context of rare earth supply chains, it reads like silk gloves covering the same iron levers Beijing has used for years: export controls, licensing regimes, and a near-total grip on midstream processing. For investors, the real story isn’t the tone. It’s the timing—and what this document strategically omits.

What the White Paper Gets Right—and Where It Gently Omits the Plot

The paper accurately describes China’s longstanding participation in global nonproliferation frameworks: NPT, CWC, BWC, and the IAEA. It proudly recounts improvements in export-control enforcement and compliance training. All true. China has indeed built a modernized legal apparatus since the 2020 Export Control Law—more structured, more bureaucratic, and more capable of asserting state control over dual-use items.

But absent from the narrative is the clearest reality of 2023–2025: China has used these same regulatory tools to constrain global access to gallium, germanium, and multiple categories of rare earths and separation technologies. These actions—though framed here as responsible governance—were also geopolitical signaling tools during tariff escalations and technology restrictions. The white paper avoids acknowledging this duality.

Reading Between the Lines: Export Controls as Strategy, Not Ceremony

China’s stated opposition to the “abuse” of export controls rings diplomatically tidy, yet Beijing itself spent the past three years tightening licenses, extending extraterritorial reach, and restricting transfers to foreign military end-users. The omission is not misinformation, but selective framing. This matters because rare earth refining—where China holds 85–90% market share—remains the world’s most leverage-prone industrial chokepoint.

The white paper’s emphasis on “peaceful uses of science and technology” parallels Beijing’s broader attempt to reclaim moral high ground in global governance debates. Yet while the document highlights inclusivity for developing nations, it sidesteps how China’s own controls delayed or disrupted access for U.S., Japanese, Korean, Australian, and European manufacturers—especially in defense and clean-energy supply chains.

Why This Matters for Rare Earth Strategy—Not Diplomacy

For Rare Earth Exchanges readers, the key insight is straightforward: export controls remain China’s quiet superpower. This white paper presents a cooperative façade but leaves intact the deeper strategic posture—China will use its processing dominance when it suits national interests, and will write the rulebook as both player and referee.

Investors should view this document not as a shift in policy, but as a signal of Beijing’s preferred narrative heading into a contested decade of mineral geopolitics. The rare earth supply chain remains vulnerable until refining, separation, and metallization capacity meaningfully diversify outside China.

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