Here Comes The Bully: China’s Rare Earth Blunder

Two months ago, just when the Senkaku incident between Japan and China seemed to reach a deadlock, China played an unexpected card. Industries in Japan reported that China began halting exports of rare earth, a vital component in electronics manufacturing, a move that caused Japan to cave in.

While Chinese officials have emphatically denied that the embargo was deliberately planned, the world remains skeptical. Damien Ma, an analyst at the Eurasia Group, believes the story is far more nuanced, though China on its part has failed to clear its charges. The timing between the embargo and the Senkaku incident was simply too uncanny, causing its justification of “environmental reasons” to look highly suspicious.
China has long tried to build its rise on peaceful principles, following Deng Xiaoping’s advice of “biding its time and hiding its capabilities” until it achieves a hegemonic status. However, both principles were contravened in a single incident. Rather than finding an alternative to diffuse the Senkaku incident, it chose to tread the path of impatience; and where it once enjoyed a quiet monopoly over the world’s rare earth exports, the incident has brought China’s “capabilities” to light (see graph), causing the world to scramble for alternative sources. Japan has identified Vietnam as a new source of rare earth, and related business groups have surfaced the issue to G20. By playing the wrong card at the wrong time, China has escalated a bilateral spat into a global affair, drawing unhealthy attention to itself.
In the end, Chinese officials will continue to try and deny such claims. If they do, they will miss the point though. In the business of global politics, perceptions are the only things that matter — and right now, the incident has only served to portray China as the regional bully. If it wants to resume its policy of a “peaceful rise” and restore its image, it will have to do much better than this.
Photo: Wikimedia Commons