Weaponizing Rare Earths: China’s Strategic Leverage in a Fragmenting Global Order

The US-China trade war highlights China’s leverage through rare earth export restrictions. Despite Western efforts to diversify supply chains, China’s dominance in rare earths is likely to persist over the next decade. Conversely, the United States retains significant power as the global financial hegemon, offering a potential counterbalance. Strategic decoupling in both domains is expected to intensify, raising concerns that economic separation between geopolitical rivals may erode the deterrents to military conflict. As interdependence weakens, the risk of escalation grows, underscoring the need for careful management of economic and strategic competition.