Podcast interview with Görg on U.S.-China Deal on Rare Earths

In June this year, high-ranking representatives from the United States and China met in London for the second time amid escalating trade tensions between the world’s two largest economies. The talks resulted in a reaffirmation of the Geneva agreement reached in May, including a substantial 90-day suspension of punitive tariffs. China agreed to resume shipments of critical raw materials and to grant temporary export licenses to U.S. firms. In response, the U.S. side signaled a conditional willingness to ease restrictions on technology exports.

In an interview with the Handelsblatt in June, Prof. Holger Görg, Ph. D. (KCG Managing Director) evaluates the importance of this “substantial rapprochement” between the two countries for the world economy. There shall be temporary export licenses, but according to Görg, it is still unclear what the agreement will look like and how reliable it is. The U.S. on the one hand seems to “perhaps [take] a bit of a deviation from the declared goal that it actually has”, namely protecting its own economy from Chinese competition by limiting exports of U.S.-technology and knowledge. On the other hand, China as the biggest exporter of rare earths and magnets is to a certain degree dependent on US- and European technology and knowledge for its advanced manufacturing development.

These are the “big levers that these two countries have against each other” where they must find a compromise. If they not only talk about an agreement but also act on it, this will be “very good news and a very important first step in the right direction”.

The interview “Rohstoff-Einigung der USA und China – was bedeutet der Deal wirklich?“ (in German) was published as a podcast by Handelsblatt on June 11, 2025 and is available here.