China rare earth policy to be adjusted to deal with the WTO ruling

WTO recently ruled that Chinese exports of rare earth products, tariffs, export quotas and other management measures for violations. This result strongly dissatisfied with the whole Chinese society . But the light not angry , we need to seriously reflect on the rare earth industry policy , the international situation and the rare earth industry after WTO ruling gives a strong response .

For a long time , China's rare earth production accounts for over 90 % of the world , according to the 2012 " China 's rare earth conditions and policies ," White Paper , China's rare earth reserves only account for about 23 percent of the world. Chinese rare earth production in a single large, because of our low cost rare earth mining , rare earth mine in other countries can not compete with China . Therefore, a high yield is primarily the result of China's rare earth resources overexploitation , not proud .

To curb excessive disorderly exploitation of rare earth resources , China has adopted a consolidation mining enterprises , implementation of export quotas and export tariffs and other measures to improve , play a certain effect , but also the international market of rare earth prices soaring , so that domestic rare earth enterprises made ​​a fortune .

Overall, however, only short-term policy measures over the past many simple executive order operation produces a lot of drawbacks . On the one hand the policy rely mainly on campaign-style execution , did not establish long-term mechanism ; hand, these policies are not in line with market rules, a lack of fairness. These policies enable some companies to reap huge profits quickly , while some companies will be excluded, but it does not enhance the competitiveness of the rare earth industry as a whole .

The ruling on China's rare earth policy is a stimulus , but also a wake-up call , it will adjust the rare Forced we reform policy .

First, a substantial increase in the rare earth mining costs . Must be strictly enforced resource protection and environmental protection regulations, increase the cost of mining enterprises . On the one hand the rare corporate profits can be transferred to public finance , promote social equity ; on the other hand , if the resource is sufficiently high environmental cost , low levels of most of the technical , environmental ineffective businesses can not survive the way through the elimination of low market mining enterprises , encourage enterprises to shift the chain and high-end .

Second, increase investment in research and development of rare earth industry . Enhance the competitiveness of the rare earth industry , the key lies in technology and innovation capacity of rare earth industry. At present, China 's rare earth industry in a number of core technology controlled by others. So rare earth enterprises should be encouraged to increase investment in research , higher R & D investment , advanced technology companies available tax incentives and other policies to support. Resources can also transfer a part of tax revenue to support scientific research institutions rare earth industry technology innovation. Catch up with developed countries in terms of technology level , China's rare earth industry to truly out of low-end chain .

Third, the expansion of overseas resources. If you have a strong rare earth mining , production, processing and technological innovation , we can raise resources by way of tax , prompting rare earth enterprises to go out and find resources on a global scale . Then you do not need to export quotas and other administrative measures , fully protecting natural resources and achieve industry goals through the market .

China's rare earth industry and at the same time does not enhance the competitiveness of resource loss in the past , now is an important opportunity to adjust relevant policies . Must thoroughly change the thinking , the core objective of the policy shift by the resource block innovation capability , in order to completely get rid of the passive situation , a real rare power. ( The author is deputy director of the Strategic Research Center of Chinese Academy of Sciences Advisory )


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