China has won The rare earth pulse to the United States granting limited licenses. Trump has celebrated it as a diplomatic victory and his country congratulates himself for ensuring the supply of critical raw materials.
Meanwhile, China is using these concessions as a screen for its strategy: consolidate a parallel financial system that can break the hegemony of the US dollar, especially in three key regions.
Why is it important. The numbers say what negotiations are not: China is artificially maintaining the yuan against the dollar (1 dollar = 7.19 yuan today) through discrete interventions of the Central Bank. Meanwhile, its trade with Africa is at historical maximums: 295.6 billion dollars in 2024.
And at the same time, it is deploying the infrastructure of the Yuan Digital in 16 countries of Asia and the Middle East. Pure geostrategy.
The context. Rare earths are lure. China dominates 85% of the chain of these minerals, fundamental in technology and defense. Each negotiation on them generates headlines and concerns, but their great bet is in the payment systems.
The United States is focused on tariffs and commercial scales. Meanwhile, China is building financial rails so that its currency circulates around the world without dollars in between.
The facts. China already connected its CIP cross -border payment systems with 170 banks in 119 countries. The Yuan Digital Procesa Transactions for more than 7 billion annual yuan and expands by Asia-Pacific and the Middle East.
Africa, whose commercial growth with China reached 5% in 2024it seems the next great objective. More than isolated figures is a financial ecosystem that allows to trade without going through the system dominated by the dollar.
What’s happening. The Chinese strategy follows the maximum of Deng Xiaoping: “hide the brightness, nourish the dark.” Avoid direct confrontation, but build robust alternatives.
Each step is a brick in another parallel financial architecture.
Between the lines. Rare earth concessions are calculated. China get a double benefit:
- Softens commercial tensions that could cause premature reprisals against their financial infrastructure.
- Project a reliable partner image towards countries that seek alternatives to the system dominated by the dollar.
Each geopolitical crisis that erodes even if the confidence in the dollar is a bit – saunciones, Threats of default– Accelerate the search for options.
And that is where China presents itself as the answer.
Yes, but. The dollar continues to have structural advantages too large to ignore them from good to first:
Yuan only reaches today 4% of world payments and has limitations such as Chinese capital controls. This transformation is underway, but it will not happen overnight.
The threat. Therefore, the risk for the United States is not an abrupt substitution, but a gradual erosion. If 20% or 30% of world trade have migrated to alternative systems, the country would lose a decisive privilege: to be able to finance “cheap” and exercise geopolitical power through sanctions.
A world with a double financial circuit (the western one with the dollar, the sin-centric with Yuan) would reduce the American capacity to isolate its adversaries.
The turning point. China is doing something that carries in its DNA: replace without confronting. USA Rare earth negotiations To project cooperation, but at the same time consolidates the infrastructure that can change the monetary map of the world.
It is also very Chinese: a decades strategy. Prepare the land so that when the dollar loses credibility, Yuan is ready to earn space. Mandarin patience to draw the financial future of Medio Planeta.
Outstanding image | Eric Prouzet and Nuno Alberto in Unspash
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