2026 Issue 22

Across multiple fronts, China's dominance over critical materials and supply chains is driving Western anxiety and a scramble for alternatives. Chinese scrap traders have quietly been buying up tungsten from US scrap yards, outbidding American buyers and prompting calls for export bans, while Beijing's 2025 rare-earth export controls continue to make critical minerals difficult or nearly impossible for US companies to obtain, pushing three-quarters of affected firms to seek non-Chinese suppliers.

In response, Western companies are pouring investment into Brazil's vast rare-earth reserves, hoping to challenge China's grip on processing and magnet production, though Brazil refuses to take sides between Washington and Beijing.

Similar structural dependence impacts pharmaceuticals, where decades of Chinese state investment have left the US reliant on China for essential medicines and their inputs—a vulnerability Beijing could exploit for coercion.

The competition extends to advanced technology, where a recent analysis found the PRC military repeatedly sought export-controlled Nvidia AI chips through commercial intermediaries to circumvent US restrictions.

Underlying it all, one analysis argues that China itself faces serious structural weaknesses, but strategically misdiagnoses them as technical or external problems rather than symptoms of systemic political flaws, constraining the reforms it is willing to pursue.