Technological innovation has historically promoted national development and supported superiority in international relations. In the contemporary world, artificial intelligence (AI) most probably will be the next crucial stage in this evolution and may determine future technological dominance on a global scale. Accordingly, U.S. President Donald Trump officially declared the AI industry as a priority in his policy agenda by signing Executive Order 14179, “Removing Barriers to American Leadership in Artificial Intelligence,” on January 23, 2025. The White House Action Plan of July 23, 2025, further outlined strategies to achieve U.S. leadership in the AI sector.
However, the United States is not the only actor in this field. China is widely regarded as its main competitor. Beijing’s IT Application Innovation initiative, known domestically as Xinchuang, includes the development and broad adoption of AI. As a result, both powers have anchored their ambitions in official legal documents, recognizing that the stakes in this emerging domain are extremely high.
From Globalization to Protectionism: The High-Tech Decoupling
The AI sector is part of the larger high-technology industry, which includes telecommunications, semiconductors, and computing systems. Over the past decade, this industry has changed from globalization to protectionism.
In 2018, President Trump banned U.S. government agencies from using telecommunications equipment supplied by Chinese firms such as Huawei and ZTE, citing national security concerns. Although the “Phase One” trade agreement, signed with China’s Vice Premier Liu He on January 15, 2020, temporarily eased tariff tensions, restrictions in the high-tech sector remained in place.
In 2022, the Biden administration imposed additional export controls on advanced computing chips and semiconductor equipment, aiming to limit Beijing’s access to high-performance technology. In response, China introduced countermeasures on December 26, 2023, and it banned U.S.-made Intel and AMD CPUs in government computers and approved 18 domestic processors from firms including Huawei and Phytium.
2024–2025: Tariffs, Rare Earths, and a Fragile Truce
Following his 2024 election victory, President Trump began to pursue his main policy of introducing new tariffs. China retaliated with reciprocal measures. The conflict culminated on April 4, 2025, when China’s Ministry of Commerce restricted exports of rare earth elements (REEs) and related magnets important to defense, energy, and automotive industries. In October 2025, Beijing introduced bureaucratic measures to further tighten its grip.
President Donald Trump and Chinese President Xi Jinping made a deal in Busan, South Korea, on October 30, 2025. The agreements mainly concerned soybean purchases from U.S. farmers and the removal of fentanyl-related tariffs by Trump. In return, China agreed to pause certain newly introduced export restrictions on REEs, while some REEs restricted since April 2025 will be covered under a general export license framework. The United States, for its part, pledged to refrain from introducing new import tariffs. This may be considered a tactical move rather than a breakthrough. Restrictions in the high-tech industry between the two states remain off the negotiating table, underscoring how strategic and decisive this sector has become in the rivalry between adversaries.
U.S. AI Dominance—and Its Hidden Vulnerability
U.S. companies, led by NVIDIA, dominate the global AI market. They possess the most sophisticated technology, including GPU chips. Most of the data centers required for processing AI data are located in the United States, and investments in the AI industry are the largest in the world. Despite this lead, U.S. firms remain dependent on China for rare earth elements. Though only trace amounts are needed in semiconductor manufacturing, these materials are irreplaceable. China processes around 90% of the global REE supply, a dominance built on low labor costs and lenient regulations.
REE reserves, however, are not concentrated in China. As per the U.S. Geological Survey, the top ten nations by reserves include Australia, Brazil, Russia, Vietnam, India, and the United States alongside China. Main mining companies such as Rio Tinto and BHP extract rare earth elements adjacent to other metals like aluminum, copper, and iron ore. In the meantime, global price fluctuations in these commodities often prevent miners from generating sufficient capital for expansion.
The Gold Mining Opportunity: A Natural Subsidy for REE Independence
Gold prices peaked at nearly USD 4,400 per ounce on October 20, 2025, which is historically high, and now it fluctuates near USD 4,000. Strong fundamentals, including central banks’ diversification away from the dollar, U.S. debt growth, and geopolitical uncertainty, continue to support elevated gold prices. Morgan Stanley forecasts gold will reach $4,500 by mid-2026.
For gold miners, this creates substantial cash flow. Newmont, for example, reported an all-in sustaining cost (AISC) of $1,566 per ounce, indicating solid profitability at current prices. Rising gold demand has also opened opportunities for mining equipment manufacturers to invest in innovation and technology that may save costs in operation and increase the productivity of their machines. For example, Sandvik, a mining equipment manufacturer, reported a strong third-quarter 2025 earnings report, with a 16% increase in its equipment orders portfolio.
This financial windfall presents a strategic opportunity: use gold profits to fund REE development. Some miners are already doing so. Idaho Strategic Resources (IDR) leverages cash flow from its Golden Chest mine to explore adjacent REE assets, including Lemhi Pass (rich in high-value magnet REEs like neodymium and praseodymium) and Diamond Creek. Even at $3,500 per ounce, gold generates sufficient earnings to sustain domestic REE exploration without government subsidies. Such a policy creates a win-win dynamic, sustaining domestic mining operations while directly reducing strategic dependence on a single source.
Conclusion: Diversify to Prevent Monopoly
If the United States sustains its AI lead and achieves REE independence through domestic and international sourcing, it could lead to a new form of market monopolization. However, China has consistently demonstrated a strong capacity to catch up with its competitors. With 90% control over REE processing, Beijing already holds a near-monopoly position.
The goal should not be to replace one monopoly with another but to prevent any single state from dominating a sector this critical and unpredictable. By enabling gold miners to allocate part of their funds into REE exploration, the United States can build a more independent and diversified resource base. This would serve as an imperative for national resource security.
