Part 7/14:
History shows that outright bans are often circumvented. China's underground black market for rare earths has thrived for decades, with smuggling networks frequently bypassing official export quotas through fake paperwork and middlemen in Hong Kong. During the boom years around 2010, estimates suggested that up to 40% of exports were unofficially shipped out.
Given these entrenched illicit networks, Beijing’s recent restrictions will likely intensify smuggling activities. As profit margins spike with the new controls, miners and traders will find ways around regulations—bribing officials and falsifying paperwork—leaving the Chinese authorities unable to regain full control. This undermines their strategic intent and further exposes the fragility of their supply chain dominance.