Interesting article, page-271

An important long article on strategic RE issues China vs US in The Australian today. Here are some important extracts imho:
‘Win everything’: China plays confidence game

Will Glasgow AUST North Asia correspondent, Chongqing 12 June
Factories in China are closing, exports to the country’s biggest export market have tanked – and all the while Beijing insists it has Donald Trump on the back foot.
Approaching the halfway mark of the first year since Trump returned to the White House, Chinese officials want to make one thing clear about the future of US-China relations.
“China will definitely win,” a Chinese official tells The Australian. “Win everything.”
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America – led right now by a self-described “very stable genius” – does not have a monopoly on hubris. Ahead of meetings in London with senior Trump administration officials that ended on Wednesday with a fragile truce, Chinese officials were at pains to stress that they were entering talks from a position of strength.
There were some holes in that story. Official data out on Monday showed China’s exports to the US had fallen by 34 per cent in May, despite America reducing ultra-high tariff levels on Chinese goods to around 45 per cent. It was the biggest drop since Beijing shut down its economy at the beginning of the Covid pandemic.
Those tumbling export numbers closely followed a survey of China’s manufacturing sector out last week which recorded the worst slump since 2022.
But some of China’s self-confidence has firmer foundations.
President Xi Jinping’s decision to use China’s dominance of rare earths to teach the Trump administration that they too are vulnerable to chokepoints is the reason the US President was so desperate for the London meeting to take place. “We do absolutely expect that the topic of rare earth minerals and magnets with respect to the United States of America will be resolved in this framework implementation,” US Commerce Secretary Howard Lutnick said on Wednesday after the meetings finished.
Mr Xi has made clear that he will flex China’s supply-chain strength when he deems it necessary. America’s supply of rare earths will be turned on and off as he sees fit. Beijing has been preparing for this showdown for years with a policy China’s state media calls, without a trace of embarrassment, ‘Xiconomics’. At its core is the importance of economic self-sufficiency, the elevation of security, a stronger role for ideology, all bundled together by China’s leader.
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For all the confident posturing, Chinese negotiators in London were desperate for those restrictions to be unwound, as well as Washington’s choking of jet engine parts, chip design software, chemicals and nuclear materials.
Lutnick made clear no relief would come until China resumed its supply of rare earths. “When they approve the licenses, then you should expect that our export implementation will come down as well,” he said.
Chinese policy makers are in almost total unison that this economic battle will be a “protracted war”, citing a phrase popularised by Mao Zedong. Their new regime for restricting rare earths was years in the making.
Some in Canberra see an opportunity for Australia to step in as a rival source of the commodities, but that would require a level of government investment and long-term planning far beyond anything committed so far by the Albanese government.
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Meanwhile, China is amassing further supply chain leverage across an increasing range of “overlapping industries”, as Arthur Kroeber, head of research at China-focused consultancy Gavekal, recently pointed out.
“The balance of leverage is shifting fast in China’s favour, a fact that the Trump team has only barely begun to recognise,” Kroeber wrote in a recent note to clients.
It’s an assessment not a world away from even the cockiest Chinese official.