China’s export quotas on rare earth elements Academic Essay

1. INTRODUCTION (1 page). Start page numbering at “1.”
In the Introduction you should:
• briefly define globalization, its types, aspects, importance, evolution, etc.;
• briefly describe a specific global phenomenon (that is, international trade in
rare earth materials) you are going to analyze in the paper (a detailed
description of the phenomenon under consideration should appear in the
Discussion part);
• carefully explain how this phenomenon fits into/relates to the process of
economic globalization, that is, whether it reflects globalization of
consumption, globalization of production and ownership, or globalization of
labor;
• describe how your paper is organized, that is, what you are going to discuss
in each of the following sections.
2. DISCUSSION/ANALYTICAL PART (3-8 pages). It is recommended that you
break this part into several sections (and sub-sections) with appropriate headings
(sub-headings). For example,
2.1. Rare earth elements, their availability and use
• What are rare earth elements/materials? What are their useful properties?
Where (that is, commercial and military applications) are they used?
• Where (in what countries) are the major known rare earth ore reserves
located? What countries are the largest suppliers of rare earth materials in
the international market? How does the US rank among the world largest
exporting nations? What has happened to the US rare earth material
supply chain since 1950? Why?
• What countries are the major buyers of rare earth materials in the
international market? How does the US rank among the world largest
importing nations?
• Describe the dynamics of US imports of rare earth materials over time
(say, the past 10 years) and provide sufficient data to support your claim:
What is the evidence of this process? Is it really happening? Does this
process intensify or weaken over time? Why?
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2.2. China’s trade policy on rare earth materials and its recent
developments
• How did China acquire a world monopoly on the family of rare earth
materials?
• List different trade barriers China has been using on rare earth materials.
Provide actual examples.
• Focus on a dramatic cut in export quotas
on rare earth materials in July 2010. Describe the export quota, how
it is set and administered. Describe the recent cut. List the reasons China
cites as a justification for this cut. In addition to these “official” reasons,
do you think China has a secret agenda? If yes, can you think of any
reason(s)?
2.3. Potential impacts and implications of the recent Chinese export
quota cut
• Describe the recent dynamics of the rare earth material prices in the
international market. To what degree the recent change in prices may be
attributed to China’s decision to cut exports? Are there any other reasons
that may have contributed to the observed price dynamics?
• Describe at least 5 consequences that the recent cut in Chinese export
quotas on rare earth materials is likely to have on the Chinese economy,
Chinese producers and exporters of rare earth materials.
• Describe at least 5 consequences that the recent cut in Chinese export
quotas on rare earth materials is likely to have on the US economy,
American manufactures, workers, and consumers.
2.4. Rare earth materials: Heading for a global resource crunch?
• Analyze potential opportunities and threats that Chinese export
restrictions pose for businesses (both in the US and worldwide): How
should businesses respond to it?
• What strategies may be implemented to reduce the US’s (as well as the
world’s) dependency on Chinese rare earth materials?
• Should the US rebuild its rare earth material supply chain? What do you
think? Provide at least 3 arguments in favor and at least 3 arguments
against. What are the major difficulties the US may face in its attempt to
rebuild its rare earth material supply chain?
• What is the WTO position on export quotas? Should the US bring a formal
case to the WTO?