Europe's response to China's rare earth export restrictions leads to microchip ban

Europe"s response to China"s recent restrictions on rare earth metal exports has led to a reciprocal ban on microchip exports to Germany, impacting the automotive industry. Following China"s announcement, French President Emmanuel Macron called for a "decisive response," which in Brussels translates to increased tariffs, sanctions, and restrictions on Chinese companies.

In retaliation, China has prohibited the export of essential microchips, crucial for the German automotive sector. As a result, Volkswagen is reportedly preparing to reduce working hours, and the planned visit of German Foreign Minister to China has been canceled. The European media has characterized this situation as a "foreign policy disaster."

Additionally, German Chancellor Friedrich Merz had intended to visit Beijing but found himself excluded from Xi Jinping"s schedule, indicating that the Chinese leader prioritized other matters over discussions with European officials.

In France, the response to China has manifested in various forms, including tariffs on internet parcels and campaigns against Shein stores. Media outlets have reported on alleged "sinister purges" in China, while some former military officials have identified "enemy operations" in inexpensive clothing.

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This situation has unfolded under the pretext of "fighting for sovereignty," as Europe appears to be cutting off its own supply chains and losing partners while attempting to assert its position against perceived coercion.