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Trump, Xi, and the new US–China standoff
US–China relations are once again on edge. After Washington expanded export controls on Chinese tech firms, Beijing struck back with new limits on critical minerals. President Trump responded by threatening 100% tariffs, then quickly walked them back.
Ian Bremmer says neither side wants a full trade war: “Trump doesn’t want to risk inflation or crash the markets, and Xi knows both countries have real leverage over each other.”
As Trump and Xi prepare to meet, from TikTok control to Taiwan tensions, Ian explains why “this relationship is tense, but not heading for a blow-up.”
U.S. President Donald Trump takes part in a welcoming ceremony with China's President Xi Jinping at the Great Hall of the People in Beijing, China, November 9, 2017.
What We’re Watching: China increases its trade leverage, Modi and Starmer meet, US undercuts Canada’s auto industry
China cracks down on critical minerals
China has implemented broad new restrictions on exports of rare earth and other critical minerals vital for semiconductors, the auto industry, and military technology, of which it controls 70% of the global supply. The restrictions come after China cut back its purchases of US soybeans, as Beijing seeks to strengthen its negotiating position ahead of trade talks between Xi Jinping and Donald Trump later this month.
Modi and Starmer cut defense deals in New Delhi
UK Prime Minister Keir Starmer and a posse of 100 business leaders took a trip to India on Monday, where he and Indian Prime Minister Narendra Modi unveiled a plan to double their current $56 billion of trade by 2030. During the visit, they announced new defense deals worth over $799 million, marking a push to reduce India’s reliance on Russian arms, even as the two sides differ over Moscow’s war in Ukraine. Starmer confirmed he discussed India’s purchases of Russian oil with Modi but respects India’s strategic independence and sees defense cooperation as key to strengthening their partnership.
Carney and Trump meet to talk tariffs
Washington and Toronto buzzed this week with talk of the Canada-US relationship. On Tuesday Prime Minister Mark Carney joined President Donald Trump in the Oval Office for a warm but inconclusive meeting. There were no breakthroughs on tariffs, just promises to “work quickly” on steel, aluminum, and energy. Trump did reportedly appreciate Carney’s proposal to revive the long-dead Keystone XL pipeline, which Trump had proposed in February.
The next day in Toronto, Commerce Secretary Howard Lutnick told attendees at the Eurasia Group and BMO US-Canada Summit that bilateral tariff deals were possible but that the integration of the two countries’ auto industries was “over.” This provoked angry reaction from Ontario Premier Doug Ford, who threatened to retaliate by cutting off energy and critical-mineral exports to the US.
The US, China, and the critical minerals question
In this Quick Take, Ian Bremmer analyzes a significant shift in US–China relations: Donald Trump’s decision to ease key technology restrictions on Beijing in an effort to secure access to critical minerals.
This move has stunned America’s national security community. Ian explains that members of the military-industrial complex are “horrified that the Chinese now no longer have a constraint on being able to compete with and potentially dominate the Americans in this most important space.”
“This is giving away the store,” Ian adds, emphasizing that the decision ultimately hands China a significant strategic advantage.
Protesters hold Democratic Republic of Congo flags during a march to voice concerns about issues regarding the recent conflict in Eastern Democratic Republic of Congo (DRC), outside the parliament in Cape Town, South Africa, February 7, 2025.
Is the DRC on the path to peace?
On Tuesday, Angola offered to mediate an end to the conflict between the Democratic Republic of Congo and the Rwanda-backed M23 rebel group. Congolese President Félix Tshisekedi traveled to Angola to discuss a potential peace process, announcing that direct negotiations could come within days – something they have been loath to engage in the past. Meanwhile, the DRC is trying to strengthen its position by leveraging critical mineral reserves to secure backing from the Trump administration.
Background: M23 is one of nearly 100 armed groups operating in the mineral-rich DRC, where ongoing violence has created one of the world’s worst humanitarian crises, displacing over 7 million people. In a swift three-week offensive last month, M23 seized two major cities and is now advancing across the eastern part of the country. Given the stakes, Tshisekedi hopes to secure US support by offering access to critical minerals in exchange for security.
The DRC holds an estimated $24 trillion in untapped mineral wealth. It is the world’s largest supplier of cobalt — a crucial material for defense, aerospace, and electric vehicle batteries — though most currently goes to China. The country also has significant lithium, tantalum, and uranium reserves, all vital to military technology.
The deal on the table: The DRC’s proposal combines security and minerals, offering the US companies favorable mining access in exchange for equipping Congolese forces and running military bases to protect supply routes. The White House signaled it's open to the offer, but even if they agree, US companies may consider it too risky to do business in the region unless a ceasefire is reached.
US-Canada trade war helps Mark Carney's election prospects
With recent tensions between Zelensky and Washington, how likely are the Saudi-hosted peace talks to yield real progress?
Well, we'll find out real soon. Zelensky has certainly made his efforts to make nice on the critical minerals deal, on apologizing to the Trump White House for a meeting that frankly he has very little to apologize for, and that certainly has helped with getting this engagement going. Also, he's not attending personally, rather, his key envoys and advisors meeting with Secretary of State Rubio and National Security Adviser Waltz. I suspect that the meetings will end up being just fine, but they are unlikely to lead to a ceasefire because what the Ukrainians are prepared to accept, the Russians are not close to accepting. So either Trump is going to have to be willing to take some time, bring it to the Russians and see that the Russians are not playing full ball, or he's going to have to throw the Ukrainians under the bus more and make greater demands that they're not prepared to accept. I don't think either of those things are likely to happen today, but that's I think, the direction of travel.
Are we on the cusp of a nuclear proliferation era as Poland and Germany talk of acquiring nuclear weapons?
Germany's talking more about sharing in the nuclear umbrella with France. Poland's talking about getting its own. These things are all harder. They will take longer than these countries have. It's not like France's nuclear umbrella is deep or easily extendable. In order to have anyone believe credibly that a French deterrent would apply to other countries, a lot of things have to happen in terms of coordination and infrastructure and building up those capabilities that will take frankly years. So, I think it's important that these conversations are happening. I think that many countries around the world are moving towards establishing their own nuclear capabilities in, around, the Middle East. I can certainly see over time as Iran gets closer, the Saudis thinking about it, the Turks thinking about it, in Asia, South Korea and Japan. In Europe, a number of countries needing to have collective security because they don't feel like the Americans can provide for them. But I don't think those things are happening overnight. The global order is changing. It is really past the tipping point, but these things are slow moving processes.
Does Justin Trudeau's replacement, Mark Carney, have a shot of winning Canada's general election?
Certainly does, and three months ago would've had no shot at all. There's been an extraordinary bounce back for the Liberal Party, in part because they're now represented by someone that is not an incumbent. Think about what would've happened in the US if it hadn't been Biden or Kamala Harris, but had been an outsider after general primary, better shot of winning. That's exactly what the Canadians have now done. Trudeau forced down, Chrystia Freeland, his deputy prime minister, getting 8% in the Liberal caucus vote, and Carney getting almost 86%. So he's a centrist. He's in much better position to give a serious run against Pierre Poilievre of the Conservatives. The big question is how is Trump going to respond? Because on the one hand, it's very easy for Trump to now say, "Trudeau's gone because of me, and I'm now willing to work with somebody who is more reasonable," and the markets would certainly appreciate that. On the other hand, short of him doing that, and I think it's unlikely that he's going to reach out and extend a hand to the Canadians, then Trump beating on Canada more gives Carney a better shot of winning because he's the guy that can manage an economic crisis and also because the Canadians are so united in their anger with the United States, kind of like Mexico is right now, kind of like a number of European countries are right now. So Trump is definitely a uniter, just not inside the US, more inside other countries.
What does Trump’s critical minerals play in Ukraine have to do with Canada?
After softening its demands, the US has secured a critical minerals development deal with Ukraine, whose president, Volodymyr Zelensky, is planning to visit Washington on Friday. The US had initially demanded $500 billion in critical minerals for jointly developing critical these resources, and, ostensibly, repaying the country for money sent to Ukraine to aid it in its defense against Russia. Ukraine hopes the deal will ensure future military funding assistance from the US, which has been thrown into doubt since Donald Trump came to office. (Read our explainer on rare earths here.)
Closer to home, as Trump threatens Canada with tariffs, there’s growing concern that the president’s ultimate aim – aside from possibly annexing the country – is gaining control of Canadian critical minerals and rare earths. These resources, which include lithium, cobalt, copper, graphite, and more, are essential to several industries and products, including electric vehicles, cell phones, computers, and military hardware, making them not just essential to the economy, but to national defense, too.
In Canada, concern over critical minerals played a notable part in the Liberal Party’s English-language leadership debate on Tuesday night, as candidates to replace outgoing Prime Minister Justin Trudeau spent much of the evening talking about threats from the US. Presumptive frontrunner Mark Carney said Canada ought to leverage its critical minerals to deal with Trump and strengthen the Canadian economy, while Parliament member and Cabinet minister Karina Gould warned that Trump’s focus on Canada was expressly tied to a play for those resources. The growing focus on economic and domestic security in the US means we could be hearing a lot more about critical minerals and rare earths in the weeks and months to come as the president refines his demands from Canada.Ukraine's President Volodymyr Zelenskiy speaks during a press conference, amid Russia's attack on Ukraine, in Kyiv, Ukraine February 26, 2025.
GZERO Explains: The curious case of Trump’s rare earths deal in Ukraine
Ukraine agreed on Wednesday to cede control over a substantial share of future mineral riches to the United States, part of a sweeping deal US President Donald Trump has suggested as a condition for continuing to support Kyiv. Trump has repeatedly claimed that the deal – which his administration says is worth $500 billion – is about “rare earths.”
So, what are rare earths? They’re a family of 17 elements used to make weapons, wind turbines, electric vehicle batteries, and other modern electronics. Among the key metals are neodymium, praseodymium, dysprosium, and terbium, the prices of which have largely fallen over the past year as demand for electric vehicles declined.
Where do they come from? Until the 1990s, the US was the top supplier, but Beijing now controls roughly 70% of the world’s raw, unprocessed rare earths and nearly 90% of the refining capacity. China isn’t shy about using that leverage – in 2010 Beijing cut off rare earths shipments to Japan amid a diplomatic dispute and has on occasion threatened to do the same to the US too. But total global production of rare earths each year amounts to only about $15 billion. That’s equal to about two days of global oil production, according to Bloomberg.
Is Ukraine a major producer? Not at the moment. Ukraine isn’t even mentioned in a US Geological Survey report on global supplies. The country has some small-scale mines that produce scandium, a rare-earth metal used in oil refining, and lightweight aluminum-based alloys like those used in bicycle frames. But those production sites are relatively tiny.
What about other minerals? Ukraine has about 7% of Europe’s supplies of titanium, a lightweight metal used to make everything from airplanes to sporting equipment to the newer versions of the iPhone. The country has some notable deposits of graphite, a key mineral for batteries and nuclear reactors. There are also some small reserves of lithium, the main ingredient in batteries, as well as iron, manganese, and uranium.
But overall, Europe’s second-largest country by landmass ranks 40th among the world’s mineral-producing nations. That could change, but mining is an energy-intensive process, and Ukraine’s power plants and pipelines are largely ruined after three years of war. What’s more, some of the rare earths are located in the eastern parts of Ukraine under Russian occupation.
So what’s in the deal? It would create a fund into which Ukraine would place half of the proceeds of “future monetization” of Ukraine’s mineral wealth, including oil and gas deposits. The size of the US stake in the fund is to be worked out in the future.
What’s not? Security guarantees from the US to Ukraine. Kyiv had sought this as part of the deal.
So, with so much uncertainty, what’s this deal really about? It’s hard to say. From Trump’s perspective, the promise of future mining revenues may offer political cover to keep US military support in place for the time being. From Zelensky’s, that’s worth it in itself, and he may figure he can negotiate security guarantees later.
What’s next? Zelensky is expected to travel to Washington in the coming days to sign the deal with Trump.
President Joe Biden hosts a virtual roundtable on securing critical minerals at the White House in Washington, U.S., February 22, 2022.
Digging deep: US military buys into Canadian mining
The US military is sinking nearly $15 million into the Canadian mining sector through the Defense Production Act in what is believed to be the first time in the DPA’s 74-year history that the US has used such funds outside the country.
Why? Both Canada and the US have gone all-in on critical minerals in recent years amid growing tensions and anxiety over China and its control of strategic supply chains.
The joint investment with the Canadian government, part of the US-Canadian Joint Action Plan on Critical Minerals, covers projects for critical minerals essential to key industries including energy, communications, and defense. These include copper, gold, graphite, and cobalt in Quebec and the Northwest Territories.
For its part, China is watching closely – while still investing its own capital into the Canadian mining sector.