U.S. and Japan Seal Rare Earths Deal to Curb China's Grip
The U.S. and Japan have signed an agreement to secure rare earth supplies, reducing reliance on China. This deal involves critical minerals and aims for diversified markets. Additionally, Japan invests in U.S. energy while balancing LNG imports amid geopolitical pressures, focusing on a robust, diversified energy strategy.
In a strategic move to counter China's dominant position in the rare earths market, U.S. President Donald Trump and Japanese Prime Minister Sanae Takaichi inked a framework agreement aimed at securing supplies of these critical minerals. The signing took place in the opulent Akasaka Palace in Tokyo under gold-adorned chandeliers, amidst applause from aides.
While avoiding direct reference to China, the agreement highlights concerns over its supremacy in processing rare earths, an area where Beijing maintains a formidable 90% control. The U.S. and Japan intend to leverage economic tools to foster diversified and fair markets for processing these minerals, potentially challenging China's export restrictions.
Beyond rare earths, Japan promises a $550 billion investment in the U.S. economy as part of a broader trade deal, covering sectors like power generation and LNG. Japan continues to diversify energy imports, balancing its strategic need for Russian LNG with new long-term contracts from the U.S., amid evolving geopolitical tensions.
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