China’s strategic design and cautious calibration of rare earth leverage

KEY TAKEAWAYS • Rare earth export controls have become a strategically designed instrument of Chinese foreign policy, applied with cautious calibration. • This calibrated approach enables Beijing to adjust outflows and manage bilateral tensions without resorting to irreversible restriction or blunt weaponisation. • How effectively Beijing balances retaliation, bargaining and decoupling risks will shape the sustainability of its rare earth leverage and the broader trajectory of its economic statecraft.