U.S. Pushes G7 Partners To Accelerate Shift Away From China’s Rare Earths Dependency

The United States is pressing its allies to move faster in reducing dependence on China for rare earths and other critical minerals, with Treasury Secretary Scott Bessent warning that progress to date has been too slow.

Bessent will host finance ministers and senior officials from the Group of Seven, the European Union, Australia, India, South Korea and Mexico at a meeting in Washington beginning Sunday evening. Together, the group represents about 60% of global demand for critical minerals.

“Urgency is the theme of the day,” a senior U.S. official said. “It’s a very big undertaking… and we really just need to move faster.”

Frustration with pace of action

Bessent has been pushing for dedicated talks since a G7 leaders’ summit in Canada last June, where he presented on rare earth vulnerabilities. Although leaders agreed on an action plan, U.S. officials say momentum has lagged.

“Leaders agreed, but there has been a lack of urgency,” the official said, speaking on condition of anonymity.

China currently dominates the sector, refining between 47% and 87% of key minerals such as copper, lithium, cobalt, graphite and rare earths, according to the International Energy Agency. These materials are foundational to defence systems, semiconductors, batteries and renewable energy technologies.

Japan remains the standout exception among G7 nations, having diversified supply chains after China abruptly curtailed exports in 2010. Most others remain heavily reliant on Chinese processing capacity.

Washington urges others to follow

“The United States is in the posture of calling everyone together, showing leadership, sharing what we have in mind going forward,” the official said. “We’re ready to move with those who feel a similar level of urgency.”

While no joint action is expected to be announced immediately, the U.S. plans to issue a statement after the meeting. Officials offered few details on next steps, but pointed to ongoing efforts to boost domestic production and secure overseas partnerships.

Washington has already struck agreements with Australia and Ukraine, and in October signed a deal with Canberra featuring an $8.5 billion pipeline of critical minerals projects. That arrangement leverages Australia’s proposed strategic reserve to supply metals vulnerable to disruption.

Canberra has since reported interest from Europe, Japan, South Korea and Singapore.

Shadow of new restrictions

The meeting comes amid reports that China has begun restricting rare earth and magnet exports to Japanese companies, alongside a ban on dual-use items for Japan’s military. U.S. officials said the talks were planned well before those developments.

For now, China continues to meet its commitments to ship critical minerals to U.S. firms and purchase American soybeans. But officials cautioned that the broader challenge remains unresolved.

“It’s not solved,” the senior official said.

  Australia, china dependency, G7, japan, rare earths, US policy