### European Industry Faces Slowdown as China Tightens Grip on Rare Earth Exports

European companies are bracing for significant disruptions as China tightens restrictions on the export of rare earth elements, vital for the production of smartphones and electric vehicles. The recent regulatory changes announced by Beijing have forced several European manufacturers to halt operations due to a shortage of these crucial minerals.

On April 4, China expanded its export control list to include seven rare earth elements – dysprosium, gadolinium, lutetium, samarium, scandium, terbium, and yttrium – in addition to several rare earth magnets. This move came two days after US President Donald Trump declared "reciprocal tariffs" on Chinese goods, leading experts to believe the measures are a form of retaliation.

The European Union Chamber of Commerce in China has actively engaged with China's Ministry of Commerce to address these new challenges. Adam Dunnett, the Chamber's secretary general, noted that the ministry is currently overwhelmed with a large volume of export applications. "Thousands of applications need to be reviewed, but the ministry's resources are limited," Dunnett mentioned during a briefing in Brussels. He added that although there have been some approvals, the processing speed has been slow, with some companies submitting multiple applications and yet seeing minimal progress.

Dunnett, who also serves as vice-chair of the European Business Organisation, pointed out that the situation has forced several businesses to cease production. "We've seen a sprinkling of approvals in the last week, but some companies have lodged dozens of applications... some have had to stop production," he said.

The new restrictions on rare earth exports are seen as an escalation in the ongoing trade tensions between China and the United States. Although primarily aimed at countering U.S. tariffs, European industries find themselves entangled in the geopolitical conflict, facing supply chain disruptions and operational challenges.

Rare earth elements are indispensable in many high-tech industries, and the current bottleneck in approvals could have far-reaching consequences for European manufacturers reliant on these materials. The prolonged delay in processing applications threatens to stall production lines, disrupt supply chains, and lead to economic repercussions across the continent.