Highlights

• Baogang Group's internal political education session demonstrates the deep integration of CCP ideology in state-owned industrial operations.
• The company functions less as a market-driven enterprise and more as an extension of the Chinese government's strategic objectives.
• Western governments and companies must recognize Chinese rare earth suppliers as geopolitical instruments, not neutral market participants.

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On March 31, 2025, Baogang Group—the Chinese state-owned steel and rare earth conglomerate—released a statement (opens in a new tab) outlining a two-day internal political education session held by its Party Committee from March 27 to 28. Branded as a study forum on the Communist Party’s “Eight-Point Regulation,” the event focused not on industrial performance, strategic planning, or market operations, but on reinforcing loyalty to General Secretary Xi Jinping and the Chinese Communist Party (CCP).

The company’s top leadership, including Chairman and Party Secretary Meng Fanying and General Manager Li Xiao, attended alongside legal, engineering, and senior departmental officials. More than a business meeting, the session functioned as a political loyalty exercise. Professors from the CCP’s Central Party School and the China University of Political Science and Law delivered keynote lectures on Party conduct and ideological discipline. Executives and managers completed mandatory readings of Party documents, participated in group discussion sessions, and were required to engage in self-study aligned with Xi Jinping Thought.

CCP Control—Make No Mistake

Chairman Meng described the study session as critical to deepening the Party’s control over the company and further advancing “Chinese-style modernization.” His remarks echoed key CCP slogans such as the “Two Upholds,” referring to absolute support for Xi Jinping’s leadership and policy direction. Meng framed internal political education as a foundation for Baogang’s future success, linking Party discipline to business outcomes and emphasizing “problem-oriented reform,” “mass-line responsiveness,” and “anti-formalism.”

While this announcement was published by Baogang Daily (opens in a new tab) under the guise of corporate news, the substance reveals no business data, operational insights, or industrial forecasts. Instead, it demonstrates how deeply CCP ideology is embedded in the company’s daily operations, even at managerial levels. Baogang is not behaving like a market-driven enterprise. It is functioning as an extension of the state—where loyalty to the Party supersedes traditional business governance.

Centralization

This blurring of political and corporate roles is especially significant given Baogang’s influence in China’s rare earth ecosystem. The company operates in close coordination with China Northern Rare Earth Group and controls major resources in Baotou, the heart of global rare earth production. For Western firms and governments, this politicization introduces several urgent risks.

First, Baogang must be understood not as a commercial partner, but as a state apparatus executing national strategy. Any engagement—from supply contracts to joint research initiatives—must be considered an interaction with the Chinese government, not an independent corporation.

Second, Baogang's deep ideological governance signals that rare earth supply chains are politically weaponized. Company priorities are subject to sudden shifts based on Party campaigns, not shareholder accountability or commercial market signals. This undermines predictability, introduces reputational risk, and contradicts Western expectations for ESG compliance, transparency, and legal insulation from state power.

Third, the lack of operational or financial transparency—replaced instead with politically themed press releases—worsens information asymmetry. While China strengthens its control over data, branding, and global messaging, Western companies are left navigating blind spots.

Finally, Baogang’s internal structure reveals the absence of a corporate firewall. The chairman is simultaneously the top Party authority. There is no structural separation between political oversight and business decisions. Western risk mitigation tools—audits, disclosures, third-party verification—are likely ineffective in this environment.

Strategic Takeaway for the West

Western governments, industrial strategists, and OEMs must reframe their understanding of Chinese rare earth suppliers like Baogang. These are not neutral market participants. They are geopolitical instruments of the CCP. As such, any long-term plan for rare earth security and resilience must:

• Decouple from Party-controlled entities like Baogang and China Northern Rare Earth
• Invest in alternative refining and processing capacity across the U.S., EU, and allied nations
• Enhance narrative competitiveness, as China uses branding and political discipline to present its dominance as stable, modern, and inevitable.

China is moving toward centralized ideological control over strategic industries. If the West fails to respond with equally strategic planning and unified messaging, it risks ceding both material supply and the global narrative on critical minerals.