Geoeconomic Agenda #6 The Past, Present, and Future of Export Controls with Kristin Vekasi
Jun 16, 2023
Kristin Vekasi, an Associate Professor at the University of Maine, dives deep into the world of export controls and economic security. She discusses the impact of G7 nations' efforts against economic coercion, particularly from China and Russia. Vekasi highlights Japan's strategic response to the 2010 rare earth embargo and the complexities of diversifying supply chains for critical minerals. The conversation extends to the balance between de-risking strategies and nationalism, shedding light on the future of global trade policies in an ever-changing geopolitical landscape.
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2010 Rare Earths Export Restriction
- In 2010, a Chinese fishing boat captain incident led to Japan facing a de facto rare earth export ban from China.
- The ban was not officially declared but was widely perceived as economic coercion amidst political tensions.
Plausible Deniability in Coercion
- China maintained plausible deniability to balance between economic integration and security concerns.
- Informal embargoes by local officials occurred without formal top-level approval to preserve economic relations.
Coercion Tool Loses Effectiveness
- Economic coercion can lose effectiveness if overused on a specific product or country.
- Japan swiftly diversified rare earth supply chains through government and industry collaboration, weakening China's leverage.