How China is borrowing American tactics to hit back at U.S. in trade war

"China likes to condemn the United States for extending its arm too far outside of its borders to make demands on non-American companies. But when it sought to hit back at the U.S. interests this month, Beijing did exactly the same.In expanding export rules on rare earths, Beijing for the first time announced it will require foreign firms to obtain approval from the Chinese government to export magnets containing even tiny amounts of China-originated rare earth materials or produced with Chinese technology."

"For anyone familiar with U.S. trade practice, China is simply borrowing a decades-long U.S. policy: the foreign direct product rule. It extends the reach of U.S. law to foreign-made products, and it has been used regularly to restrict China's access to certain U.S. technologies made outside of the United States, even when they are in the hands of foreign companies."

"It is the latest example of Beijing turning to U.S. precedents for tools it needs to stare down Washington in what appears to be an extended trade war between the world's two largest economies."China is learning from the best," said Neil Thomas, a fellow on Chinese politics at Asia Society Policy Institute's Center for China Analysis. "Beijing is copying Washington's playbook because it saw firsthand how effectively U.S. export controls could constrain its own economic development and political choices.""

China expanded export rules to require foreign firms to obtain Chinese government approval to export magnets containing China-origin rare earth materials or produced with Chinese technology. The new rule applies extraterritorially, affecting non-Chinese companies and third-country sales. The policy mirrors the U.S. foreign direct product rule that extends U.S. law to foreign-made products and has been used to limit Chinese access to U.S. technologies. Beijing adopted these measures after the 2018 trade confrontation and is explicitly using U.S. precedents to build tools for contesting Washington. The measures risk controlling global technology supply chains and escalating an extended U.S.-China trade conflict.

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