Rare Earths: Future Elements of Conflict in Asia?

China’s sudden suspension of rare earth exports to Japan in September 2010 represented the opening of a new front in the international competition for natural resources. As the demands of the global economy change, the international demand for rare earths, which are used in a diverse range of high-tech industries, has also increased. As China is currently the largest rare earths exporter, its actions in regulating rare earths exports will directly affect the interests of other states in the supply chain. This paper therefore examines how China assumed this dominant position in the supply chain. It also looks at how major rare earths consumers such as Japan and South Korea are reducing their reliance on and vulnerability to Chinese rare earths supplies through means such as seabed exploration in disputed territories, which might contribute to geopolitical tensions and instability in the East Asian region.