The actions cite China's restriction on exports of 17 forms of rare earths, in addition to tungsten and molybdenum. They state that China administers these export restrictions through its ministries, as well as "other organizations under the State Council and various chambers of commerce and industry association." They also state that it appears that China administers the export restrictions and associated requirements and procedures "in a manner that is not uniform, impartial, reasonable, or transparent," and "through measures that are not published."
Karel De Gucht, the EU's trade commissioner, made an even more forceful statement than Obama. "China's restrictions on rare earths and other products violate international trade rules and must be removed," he said. "These measures hurt our producers and consumers in the EU and across the world, including manufacturers. Despite the clear ruling of the WTO in our first dispute on raw materials, China has made no attempt to remove the other export restrictions. This leaves us no choice but to challenge China's export regime again to ensure fair access for our businesses to these materials."
An earlier Design News article on US manufacturing implied by its title that Obama has been timid in taking action to improve US technical manufacturing jobs. I agreed with that view until I read about this WTO action. I don't entirely agree with the conclusion that we should compete with China, where so many jobs have already gone, and not litigate. The whole point of the rare earth issue is that China's stance is making it extremely difficult to compete by unfair restriction of trade. So competition alone is not enough.
Litigation presents an uneasy scenario. The purpose of global organizations such as the WTO are to hold court, in the more old-fashioned, non-judicial sense of talking things out among one's peers. The WTO's description of its settlement process includes the statement that most of its disputes have not gone further than the consultation stage, "either because a satisfactory settlement was found, or because the complainant decided for other reasons not to pursue the matter further." In other words, most of them rarely reach litigation. I hope this one doesn't. But if China refuses to cooperate on the rare earth issue, the US -- and Japan and the EU -- may have to do both: compete and litigate.
Rob, you're sure right about difficulty in occupying the country by US and Soviet forces. But the problem is, there's no overall economy for the dollars to go into: there are tribes and powerful individuals/families within those tribes. Some of them, most likely those already in power, very likely the ones we don't like, will manage to get the dollars, assuming there are any left after all the mercenaries and whatnot forces we send over there have taken their pickings first. There's no particular reason to think that similar sociopolitical-economic structures (to sub-Saharan Africa or portions of the Middle East like Iraq and our involvement with them) will produce different results.
Yes, you're right about Afghanistan, Ann, which is probably part of the reason the Soviets and the U.S. have had so much trouble occupying the country. I would think that the dollars would still go into the economy in one way or another, but maybe not.
Rob, thanks for the info. You're right, that looks promising. However, it's not going to do the country much good overall because Afghanistan isn't really a country, in the sense of a state. It's a collection of people with different ethnic and linguistic origins living mostly in nomadic tribes at conflict with each other, and without any overall unifying sense of statehood. If the main European invasion of North America had been by Vikings or Celts in the years 500-1000 AD, we might have had a sociologically and technologically similar situation here, among native and European-born tribes in conflict with each other.
Some American officials have estimated the Afghan rare earth deposits are worth up to one trillion dollars. So it is significant. That should have some impact on the country's economy even it it goes to just a few.
Dave, I agree with you about the unlikelihood that Afghanistani residents will benefit from this discovery. My references to chess and and poker concerned relations between the governments of the US and China, which are actual nations with a sense of statehood and longstanding central governments, regardless of what we may think of them. That description does not fit Afghanistan in the least: politically and sociologically it is much more like many sub-Saharan African "nations."
Rob, thanks for that info about the discovery of rare earth minerals in Afghanistan. Given the long history of outside intervention in that country, I find it difficult to believe that the people who live there will benefit from this discovery.
I understand your point, Dave. In some of these under developed countries, it is a small number who actually benefit. With the Congo, there is at least a movement among developed countries to avoid the use of "conflict materials." Though I have to say, I'm not sure how well the effort is succeeding.
@Rob: I'm sure that the people of Afghanistan will be the ones to benefit from their country's mineral resources, just like the people of the Congo have, right?
Maybe this is a game for companies and for governments -- but whether it's chess or poker, it seems that the populations of natural resource-rich countries are almost always the losers.
That's pretty good, Ann. I like your differentiation. To further complicate the world of rare earth minerals, a huge supply has been discovered in southern Afghanistan. Geologists estimate Afghanistan has enough rare earths to supply the world's need for 10 years:
Rob, now I'm thinking that the relationships, which are complex, resemble chess sometimes and poker at others, and in both cases, military strategies or tactics. Over the long haul I suspect it's more like chess: you can see your opponent's "hand" (pieces on the board) and guess at their strategy while formulating your own (like war). At the tactical level, I think it's more like poker: you don't know what resources your opponent has for this next confrontation (battle) or what tactics they will use, so you rely more on bluff.
I think your observation is very interesting about government and industry re who's playing which game.
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