President Donald Trump has threatened to charge China “200% tariffs or something” if Beijing restricts exports of rare earth magnets to the U.S.
“They [China] have to give us magnets,” Trump said on Monday. “We’re heavy into the world of magnets now, only from a national security standpoint. But we have a powerful thing. It’s airplane parts and many Boeing (NYSE:BA) jets.
He noted that China had 200 planes that were unable to fly as the U.S. wasn’t giving them Boeing (NYSE:BA) parts because of China’s rare earth curbs. “I sent them all of the parts so their planes can fly. I could have held them back. I didn’t do that because of the relationship I have. And they’re flying.”
Boeing (NYSE:BA) is reportedly in talks to sell up to 500 aircraft to China, with details such as jet models and types still being finalized.
China dominates global rare earth production, and this has become its main leverage in the trade war with the U.S. Beijing halted most rare earth exports to the U.S. back in April, and later agreed to normalize flows as part of a trade truce with Washington.