In Geopolitics Today: Thursday, December 21st
China Tightens Control Over Rare Earths Supply Chain, Angola Exits OPEC, and other stories.
China Tightens Control Over Rare Earths Supply Chain
China has imposed new export controls on technologies related to rare earth metals, including those used for magnet manufacturing. The move tightens China's grip on the supply chain as the US, Japan, and others seek to boost domestic production and reduce reliance on China, which provides 70% of global output. While the rules don't restrict rare earth exports directly, they could frustrate Western efforts to develop independent refining capabilities.
The export ban covers technologies across the rare earths supply chain — from mining and separation to metal and magnet production. This reflects China's concern over losing its strategic dominance as the US and allies invest in alternative supply chains for materials critical to defence, electronics and clean energy. The challenge for the West will be overcoming knowledge gaps to build rare earth refinement facilities from scratch. While new US and European initiatives aim to spur mining, China's latest move underscores the end-to-end supply chain control required for true strategic autonomy. Efforts are underway to collaborate with non-Chinese suppliers, but breaking China's monopoly will likely take years absent a major technological breakthrough.
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Gaza Escalation Threatens Lebanon's Economy
Lebanon's already battered economy would likely not survive the fallout of a war between Hezbollah and Israel. While Hezbollah relies heavily on Iran for funding and weapons, its territorial base in Lebanon makes it vulnerable, as most Lebanese blame the government for the economic crisis. Renewed conflict could prompt the withdrawal of foreign investment and decimate revenue-generating industries like tourism.
Given vastly more destructive capabilities since 2006, the economic impact could eclipse that war's $2.8 billion in damage. Lebanon is already in financial ruin — its GDP has plummeted 40% with over 80% of citizens now in poverty. The World Bank ranked its economic crisis among the most severe globally since the mid-19th century. A Hezbollah-triggered war would likely represent the final blow, making the group's position in Lebanon untenable. With so much at stake and Lebanon unable to bear further strain, Hezbollah leader Hassan Nasrallah would be wise to refrain from military escalation, despite Iranian support. Mounting public resentment of Hezbollah’s role in government may ultimately undermine its strategic parasitic relationship with Lebanon if conflict triggers complete economic collapse.
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Kazakhstan Localizes Drone Production Through New Partnerships
Kazakhstan has announced the selection process is underway for a domestic company to produce Turkish Anka combat drones starting in 2024. This confirms an agreement reached in May 2022 between Kazakhstan Engineering and Turkish Aerospace Industries to assemble and maintain the unmanned aerial vehicles locally. Kazakhstan will become the first foreign country to produce the combat drones.
The joint drone production highlights deepening Kazakh-Turkish military cooperation as Russian regional influence recedes. For Kazakhstan, localizing defence manufacturing supports its multi-vector foreign policy and ambitions to strengthen domestic industry. Beyond the drones deal with Turkey, Kazakhstan is also partnering with China and South Korea to produce various unmanned systems. Russia's diminished role has opened the door for Kazakhstan to pursue new defence relationships. While still maintaining ties with Moscow, Astana is steadily diversifying its partnerships — prioritizing technical expertise and localized production to reduce reliance on external sources.
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Angola Exits OPEC
Angola announced it is leaving OPEC effective immediately, with oil minister Diamantino Azevedo stating membership no longer serves the country's interests. Angola's departure deals a blow to the cartel as it tries to get members to cut output amid declining prices. Last month, Angola protested its reduced 2024 production quota within OPEC. The decision comes after tense quota negotiations between Angola, Nigeria, and other OPEC members.
Angola's exit reflects broader geopolitical realignments underway as the US courts Angola to keep oil prices affordable while OPEC pushes for production cuts to raise them. With Angola embarking on economic reforms under President João Lourenço, he likely wishes to boost oil production to spur growth. Meanwhile, President Biden hosted Lourenço this year to discuss regional security and potential economic partnerships, aiming to counter rising Chinese influence in Africa. OPEC membership now conflicts with domestic goals and its evolving partnership with the US. This may incentivize further cooperation between the US and African producers like Angola and Nigeria on energy policy.
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Stalled Progress with North Korea Leaves Few Good Options for the US
North Korea has made steady advances in its nuclear and missile programs over the past few decades through repeated tests, despite international condemnation and sanctions. With complete denuclearization no longer realistic, experts argue the US and allies should politically accept North Korea's nuclear status and instead focus diplomacy on arms control and reduction. However, North Korea has proven an unreliable negotiating partner, likely demanding reciprocity and obfuscating the truth.
Still, re-engaging North Korea with modified expectations could yield near-term wins like capping parts of existing programs and reducing stockpile risks. And getting a foot in the door may provide glimpses of intelligence value. Talks could also restart the Six Party framework and buy time to prevent wider nuclear proliferation. While North Korea would probably halt weapons testing during talks, its history suggests covert advancements may continue — but some visibility and program constraints are preferable to the unchecked expansion of capabilities now occurring. With military options off the table, a pragmatic shift toward interim arms control, vigilant verification provisions, and preventing proliferation to other states may be the best pathway available to mitigate North Korean nuclear risks.
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Russia Poised to Retain Territory Absent Increased Western Support
If NATO military and financial aid to Ukraine declines going forward, Russia will likely retain or expand its territorial control in Ukraine. In recent public comments, Russian President Vladimir Putin reiterated maximalist Russian war aims and claimed Russia has enough volunteer soldiers and steady economic growth to sustain the war effort. Militarily, Russia looks poised to leverage its manpower advantage and expanding defence industries to continue seizing Ukrainian territory.
Russia’s likely retention of captured territory in Ukraine risks allowing Moscow to cast the war as a strategic success. This could accelerate the transition to a more unstable multipolar order, as the example of Ukraine leaves some U.S. partners questioning Washington’s reliability. Meanwhile, even in the case of peace talks, lacklustre Western support could still leave Ukraine incapable of forcing Russia to honour any ceasefire deal or halt efforts to destabilize the country. So while risky and costly, the Kremlin likely views the current trajectory in Ukraine as sufficient for achieving its aims of neutralizing a West-aligned Ukrainian state.