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US-Venezuela conflict
EconomyChina Economy

Behind the Venezuela crisis, a US-China tussle over critical minerals

Venezuela, Greenland and Colombia all have large deposits of rare earths and other minerals needed by US technology and defence companies

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In this photo released by the White House, US President Donald Trump monitors American military strikes in Venezuela alongside CIA director John Ratcliffe and Secretary of State Marco Rubio, in Mar-a-Lago, January 3. Photo: AP
Kandy Wong
Washington’s abduction of Venezuelan leader Nicolas Maduro last week has been characterised by many – including US President Donald Trump – as an attempt to gain control over the South American nation’s oil industry.

But analysts said the crisis was also about Washington’s need to secure access to critical minerals – and that other resource-rich nations should be on guard.

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In addition to its vast oil reserves, Venezuela has significant deposits of an array of precious metals and other valuable resources, including rare earth elements that are vital inputs for the US technology and defence industries.

The country’s southern Guayana Shield region has “vast mineral richness”, with the area laced with deposits of gold, diamonds, iron ore and bauxite, as well as rare earths and other critical minerals, according to a 1993 report by the US Geological Survey, one of the few overviews of Venezuela’s mineral resources made publicly available.

These minerals have become the subject of an intense tussle between the US and China in recent months, as Beijing has weaponised its dominance of global rare earth supplies by placing export controls on the resources to gain leverage in its trade war with Washington.
Though China suspended some of those controls after agreeing a trade truce with Washington in November, the US is still striving to reduce its reliance on China for key resources, signing minerals deals with a slew of countries including Australia, Malaysia and Thailand in recent months.
Washington’s push to shore up its access to critical minerals is likely to continue, which could lead it to step up efforts to annex Greenland and possibly even target resource-rich nations like Colombia and Chile, some analysts warned.
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Though Trump has yet to confirm plans for asset seizures or other coercive measures targeting Greenland, Colombia or Chile, his recent rhetoric and actions signal attempts to gain “resource and trade leverage” over them, according to James Downes, co-director of the Centre for Research and Social Progress, an Italy-based think tank.

Denmark has already had to “firmly reject” talk of the US taking over Greenland, while Washington threatened Colombia with tariffs in January amid a dispute over migrant deportation flights. Chile had not been directly mentioned by US officials, but faced “similar pressures amid Latin American anxieties”, Downes said.

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