U.S. ITC Slaps Solar Tariffs on Four ASEAN Member States
Local U.S. solar companies requested the tariffs
Chinese firms reduce indirect exports and build production bases in the U.S.

The global solar industry is caught in the crossfire of deepening geopolitical and economic rivalries. As the world transitions toward renewable energy, solar panel manufacturing has become both a symbol of industrial progress and a battlefield of trade disputes. At the center of this latest conflict is the United States, which has imposed shockingly high tariffs—reaching up to 3,500%—on solar products imported from four Southeast Asian countries. But this is not simply a regional trade adjustment. At its core, the sweeping U.S. decision is a strategic strike against what Washington sees as China's backdoor access to the American market through third-party countries. As Chinese firms seek ways to adapt, and American solar manufacturers call for protection, a new era of solar supply chain realignment is rapidly taking shape.

U.S. Ramps Up Crackdown on Southeast Asian Solar Imports

On June 10, Nikkei Asia reported that the U.S. International Trade Commission (ITC), backed by recommendations from the Department of Commerce, had announced massive anti-dumping and countervailing duties on solar panels and cells imported from Malaysia, Vietnam, Thailand, and Cambodia—four ASEAN member states that have become key players in global solar exports. The tariffs vary significantly by country, reflecting the degree of perceived compliance or non-cooperation during the U.S. investigation. Thailand will face tariffs ranging from 375% to 972%, Vietnam from 120% to 813%, and Malaysia from 14% to 250%.

But the most dramatic action was taken against Cambodia, a close ally of China and the country deemed least cooperative during the U.S. inquiry. According to the U.S. Department of Commerce, Cambodian solar manufacturers refused to fully engage with American investigators, leading to punitive tariffs ranging from 650% to a staggering 3,500%. The escalation follows a series of actions earlier this year, including Cambodian firms’ withdrawal from participating in U.S. anti-dumping investigations back in March—decisions that only deepened U.S. suspicions.

These tariffs come amid broader concerns that the U.S. solar market is being flooded with cheap products manufactured by Chinese firms, not directly from China, but from facilities strategically located across Southeast Asia. The U.S. government believes this has severely disrupted fair competition and undermined the country’s efforts to build its own clean energy manufacturing base.

Domestic Pressure and China’s Strategic Retreat

At the heart of the U.S. crackdown lies the growing frustration among domestic solar manufacturers. In 2023, a coalition of seven American solar companies—including major players like Hanwha Q CELLS USA and First Solar—formed the American Alliance for Solar Manufacturing Trade Committee. They submitted a formal petition to the government claiming that solar products imported from Malaysia, Vietnam, Thailand, and Cambodia were being sold below the cost of production. These firms pointed to years of declining prices and shrinking profit margins, blaming a wave of dumped products that had destabilized the domestic solar industry.

But their criticism extended beyond pricing. The alliance asserted that many of the factories producing these imported solar panels were actually owned or operated by Chinese companies. Their core accusation was that Chinese firms—already subject to earlier rounds of tariffs—had established or expanded their operations in Southeast Asia specifically to sidestep those trade restrictions. This so-called “transshipment” practice allowed Chinese products to enter the U.S. market under the guise of Southeast Asian origin, effectively nullifying the impact of earlier duties.

The impact has been profound. According to the Korea Energy Economics Institute, around 80% of all solar products imported into the United States now come from just these four countries. The flood of low-cost imports has driven U.S. manufacturers to the brink, prompting urgent calls for trade protectionism.

In response to the shifting regulatory environment, several Chinese solar companies have already begun scaling back operations in Southeast Asia. LONGi Green Energy, one of the world’s largest solar firms, halted production at five of its Vietnamese lines last year and has since cut back output in Malaysia. Trina Solar also decided to limit its production in the region, and Jinko Solar took more drastic action by shuttering its Malaysian factory altogether.

This retrenchment signals a turning point for Chinese firms. Southeast Asia, once seen as a safe and cost-effective haven for export manufacturing, is now fraught with rising compliance risks and geopolitical complications. Chinese companies are consequently looking elsewhere to diversify their production footprints. According to Yana Khrushchova, Head of Global Solar Supply Chain Research at Wood Mackenzie, the next manufacturing hotspots could be Indonesia, Laos, or even the Middle East. Some companies are already exploring relocation options, while others are holding off until the final structure of U.S. tariffs becomes clearer.

Chinese Giants Double Down on U.S. Soil

Faced with higher tariffs and growing scrutiny, Chinese solar firms are shifting gears—not just geographically, but strategically. One of the most striking developments is the rise of China-backed solar manufacturing inside the United States itself. Chinese companies are no longer just trying to bypass tariffs; they are embedding themselves in the U.S. market through direct investment and local partnerships.

LONGi Green Energy, in collaboration with American renewable energy firm Invenergy, has established a joint venture named Illuminate. Based in Ohio, Illuminate operates a massive 5-gigawatt (GW) solar panel assembly plant. The facility is already producing nearly nine million panels annually and employs more than 1,000 U.S. workers, blending Chinese capital and know-how with American labor and regulatory compliance.

Trina Solar is following a similar path. The company is constructing another 5GW solar panel facility in Texas, expected to be operational in the near future. And this is just the beginning. According to Reuters, Chinese firms are on track to build up at least 20GW of solar panel manufacturing capacity in the U.S. by 2026, which would amount to nearly half of the total U.S. solar market. If realized, this could allow Chinese companies to maintain their dominant position in the industry while minimizing exposure to future trade restrictions.

These moves reflect a deep recalibration of China’s solar export strategy. By localizing production within the U.S., Chinese manufacturers can both serve the world’s second-largest solar market and insulate themselves from the growing risk of protectionist trade policy. For Washington, the situation presents a paradox: while aiming to weaken China’s grip on the solar supply chain, its own market dynamics and manufacturing gaps are inviting Chinese firms to set up shop on American soil.

In the broader landscape, this moment marks a transformation not only in solar supply chains but in the geopolitics of clean energy. As the U.S. takes aim at indirect exports and tariffs become sharper weapons in trade wars, solar power is no longer just about photons and panels. It’s about power—both electrical and political—and which nations will control the flow of both.

Trump Again Urges Fed Chair Powell to Cut Interest Rates
Fed Signals Wait-and-See Approach, Citing Need to Assess Tariff Impact
Mounting Pressure for Rate Cuts Amid Looming Shadow of Recession

U.S. President Donald Trump has once again called on Federal Reserve (Fed) Chairman Jerome Powell to lower the benchmark interest rate. As the Fed maintains a wait-and-see stance while closely monitoring the aftereffects of tariff policies, pressure from the administration to adjust interest rates is intensifying. This growing tension appears to stem from differing inflation outlooks between the Fed and the White House.

Trump’s Push for Interest Rate Cuts

According to foreign media reports on the 10th, President Donald Trump has been persistently urging the Federal Reserve to cut interest rates. On the 6th (local time), he wrote on his social media platform, Truth Social, that a “Fed that acts ‘too late’ is a disaster,” adding, “Lower the rate by a full 1%.”
He continued, “There is virtually no inflation right now, and if inflation does return, we can respond by raising rates,” criticizing, “The ‘too late guy’ (Chair Powell) is costing America a fortune.”

Speaking to reporters aboard Air Force One on the 7th, Trump also said, “I’ll be announcing the next Fed Chair soon,” and emphasized, “A good Fed Chair is someone who knows how to lower rates at the right time.”
Although Powell’s term is set to run through May 2026, Wall Street has continued to speculate that Trump may try to sideline him by appointing a so-called “shadow chair” before his term ends, potentially triggering a lame-duck period for Powell.

This is not the first time Trump has used the Fed Chair position as leverage to push for rate cuts. The Wall Street Journal previously reported that Trump considered firing Powell early back in April but ultimately abandoned the idea after being dissuaded by Treasury Secretary Scott Bessent and Commerce Secretary Howard Lutnick. They reportedly warned that removing the Fed Chair—whose position is designed to be independent—could undermine trust in the U.S. economy and trigger a financial crisis, which led Trump to back down.

The Fed Maintains a Cautious Stance

Despite Trump’s pressure, senior Federal Reserve officials remain cautious about cutting rates. John Williams, President of the New York Fed, stated at a recent Mortgage Bankers Association conference that, “Just because it’s June doesn’t mean we’ll suddenly understand what’s happening in the economy,” adding, “The same goes for July.” His remarks implied that it will take time to fully grasp the economic impact of Trump’s aggressive tariff policies.

Raphael Bostic, President of the Atlanta Fed, echoed a similar sentiment in an interview with CNBC. He identified Trump’s tariff policies and Moody’s downgrade of the U.S. credit rating as key sources of economic uncertainty.
“These developments will impact the broader economy,” Bostic said. “It will take 3 to 6 months to see how this situation plays out.” He added, “It seems likely that it will take longer for things to settle,” and indicated he is leaning toward a single rate cut this year.

Previously, in its March FOMC dot plot (a chart showing rate projections by Fed officials), the Fed had signaled the possibility of two rate cuts by the end of the year.

Fed Chair Powell, too, has consistently warned about the uncertainty surrounding tariff policies. He has repeatedly said that the Fed would assess inflationary effects caused by tariffs before making any rate decisions. However, the White House takes a different view, believing that tariff-induced inflation is merely a “one-off” event. Stephen Miran, a member of the White House Council of Economic Advisers, told CNBC that “Inflation is performing quite well” and that “There are no early signs of a renewed rise in inflation.”

He further argued that Trump’s first-term tariffs, implemented in 2019, did not lead to inflation. “With no signs of inflation and with the economy in a stable position, the Fed should move away from its restrictive stance and begin normalizing interest rates,” he asserted.

"Fears of Economic Downturn Mount"

Whether the Federal Reserve can continue to maintain a confrontational stance against the White House remains uncertain, as recession concerns are rapidly spreading across various sectors of the U.S. economy.

According to a survey conducted last month by the U.S. think tank Conference Board in collaboration with the Business Council—a forum of corporate executives—83% of 133 surveyed CEOs predicted that the U.S. economy would experience either a “short and mild recession” (71%) or a “severe recession” (12%) within the next 12 to 18 months. This figure more than doubles the 30% recorded in the third quarter of last year and closely mirrors the 84% figure seen in Q3 2023, when fears of prolonged high interest rates were at their peak.

The “CEO Confidence Index,” which measures executives’ assessments of current and future economic conditions, dropped to 34 in the latest survey—its lowest level since Q4 2022. The index fell by 26 points compared to the previous survey, marking the largest drop since the index’s inception in 1976.

Only 11% of CEOs in the first-quarter survey believed current economic conditions had worsened compared to six months prior, but that figure surged to 82% in the latest poll. Conversely, the share of CEOs who said conditions had improved plummeted from 44% in Q1 to just 2%.
Expectations for future economic deterioration also rose sharply: the percentage of CEOs predicting worsening conditions in the next six months jumped from 15% to 64%.

Similar concerns have emerged in the investment banking sector.
Jamie Dimon, CEO of JPMorgan Chase and a Wall Street heavyweight, said in an interview with Bloomberg TV during the JPMorgan Global Markets Conference in Paris last month, “If a recession occurs, it’s difficult to predict its scale or duration.” He added, “We hope to avoid a recession, but at this point, we cannot rule it out,” noting that JPMorgan’s economists currently place the probability of a recession at 50%.

Rearmament Push Triggered by Ukraine War
NATO Urges Germany to Boost Troop Levels by 40,000
New Government Ramps Up Security Drive with Daily Calls for ‘War Readiness’

In Germany, which has been pursuing rearmament since the outbreak of the war in Ukraine, the debate over reinstating conscription is reigniting. Critics argue that continued reliance on voluntary enlistment will fall short of meeting NATO troop targets. As conscription is being reconsidered for the first time in 14 years since the adoption of an all-volunteer force in 2011, there are growing calls within Germany to extend mandatory service equally to women as well as men.

Calls for “Mandatory Service for Both Men and Women” Grow in Germany

On June 9 (local time), Stern magazine reported that Thomas Röwekamp, Chair of the Bundestag Defense Committee, declared that “Out of the 700,000 people finishing school each year, only 10,000 choose to serve in the Bundeswehr.
We cannot enjoy freedom and prosperity while relying solely on the duties of others.”

He advocated for the introduction of universal mandatory service for both men and women. This would include not only military service but also compulsory work at fire departments and other public institutions.

Since the outbreak of the war in Ukraine, Germany has been debating the revival of conscription, which was abolished in 2011. The discussion had subsided after the Ministry of Defense proposed an amended conscription law focused on voluntary enlistment, based on a survey of 18-year-old men and women regarding their willingness and fitness to serve.

However, debate is resurfacing following the Ministry’s recent announcement that Germany needs to increase active-duty troops by up to 33%. On June 5, Defense Minister Boris Pistorius stated that to meet NATO's requirements for arms and manpower, Germany would need an additional 60,000 troops.

As of the end of last year, Germany’s Bundeswehr had 181,150 active soldiers—40,000 short of the Defense Ministry’s target of 203,000. Last month, Reuters reported that NATO plans to request Germany to expand its forces by 40,000 troops across seven brigades.

Initially, Minister Pistorius maintained that shortages in barracks and training facilities made conscription infeasible. However, following the inauguration of the new government, his tone shifted. He now says that infrastructure will expand faster than expected, and conscription could be reconsidered if troop levels fall short.

Germany’s Push for “Security Independence” Reignites Conscription Debate

The push to reinstate conscription is being led primarily by the ruling Christian Democratic Union (CDU), following Chancellor Friedrich Merz’s declaration that Germany must pursue security independence from the United States and build Europe’s strongest military.

In alignment with this security drive, top defense officials are warning that Germany must prepare for war, effectively identifying Russia as a hostile power.

Carsten Breuer, Inspector General of the Bundeswehr (equivalent to Chief of Defense), stated in a recent interview that Russia views the Ukraine war as part of a broader conflict with NATO and could invade a NATO country within the next four years. He mentioned, “There’s no guarantee it won’t happen before 2029. We must be prepared to fight tonight,” he warned.

Annette Lehnigk-Emden, Head of the Bundeswehr Procurement Office, echoed that sentiment, saying, “We may have only three years. We must complete all necessary defense preparations by 2028,” adding that 100 weapons procurement plans will be submitted to parliament within this year.

Ralph Tiesler, Head of Germany’s Federal Office of Civil Protection and Disaster Assistance, added: “There has been a long-standing belief that war was not a scenario we needed to prepare for. But now, the risk of a large-scale invasion war in Europe is looming over us.”

He proposed expanding the country’s civil defense capacity—increasing shelter space from 480,000 to 1 million people by repurposing subway stations, public basements, and underground parking lots. He also called for doubling the number of emergency sirens from 40,000, with a detailed plan to be announced this summer.

Germany’s Rearmament: A Double-Edged Sword?

Some military and security experts warn that Germany’s rearmament could provoke Russia and, in turn, jeopardize the security of Europe as a whole. This issue goes beyond a mere increase in military spending—it lies at the heart of Europe’s strategic identity and the potential restructuring of its future diplomatic and security landscape.

If Germany justifies its rearmament based on the threat posed by Russia, it may, in the short term, emerge as Europe’s sole response leader. However, in the longer term, this could give rise to a dual-track strategy—especially among Eastern European countries—that seeks direct diplomatic engagement with Russia. Such divergence could become a source of internal division, undermining Europe’s collective strategic cohesion.

Historically, Europe has stopped short of defining Russia as a fully hostile power, instead seeking to balance competing interests and play the role of a peaceful mediator. The so-called “balanced diplomacy” maintained by Germany and France served as both a strategy for avoiding war and a valuable diplomatic asset. If Germany’s rearmament signals a departure from this framework, Europe may risk losing its diplomatic autonomy, becoming entangled in a proxy conflict between the U.S. and Russia.

Another issue is whether Europe—structurally weak in ground forces—can develop and execute an independent foreign policy without the U.S. security umbrella. At a time when the European Union (EU) needs unified strategic planning more than ever, the gaps in military capacity and defense budgets between member states remain significant. With even basic consensus on defense spending goals proving difficult, some critics argue that Germany’s rearmament may ultimately be more symbolic than substantive.

NHN Halted Uploads of French-Language Titles in January
Kakao Piccoma Closed Its European Subsidiary Last Year
Local Platforms Struggle Amid Slowing Global Webtoon Growth

NHN, which operates a global webtoon platform, is reportedly considering suspending its webtoon services in France. Although France has long been considered the most promising European market for comics due to its high consumption levels, Korean platforms are gradually pulling out amid sluggish growth in the global webtoon industry following the end of the pandemic. Last year, Kakao Piccoma withdrew from the French market by shutting down its European subsidiary based in the country.

France, Europe's Largest Comic Market, Sees Webtoon Growth Slowdown — Korean Platforms Scale Back

According to the IT industry on the 8th, NHN’s global webtoon platform Pocket Comics has halted uploads of new content in France since early this year. NHN stated, “We’ve temporarily suspended updates for Pocket Comics France to comprehensively review the platform’s operational system and overall efficiency.” Industry insiders note that this move is the result of sluggish growth in the European market and rising concerns over whether high investment costs can be recovered. NHN is reportedly reviewing multiple scenarios, including a complete withdrawal from the French market.

France has long been considered Europe’s largest comic book market, with Japanese manga already deeply embedded in the culture. A 2023 French reading report indicated that 48% of French people read comics. NHN launched Pocket Comics in France in January 2022, targeting women in their 20s and 30s, and even topped local webtoon app revenue rankings at one point. However, with the French comics market still dominated by print volumes similar in form to graphic novels, webtoon growth has stagnated, and Korean content has struggled to match local expectations, prompting NHN to consider exiting the market.

Complete Exit from Southeast Asia Last Year

NHN began its overseas expansion in 2013 with the launch of NHN Comico in Japan, followed by an expansion into Southeast Asia—including Taiwan, Thailand, and Vietnam—in 2014. In 2020, NHN launched Pocket Comics, the English-language version of Comico, in the U.S., Canada, Australia, and the U.K., where it initially ranked first or second in Google Play’s Books category.

In 2022, NHN rolled out German and French versions of Pocket Comics as part of its European expansion, but plans for further growth in the region were ultimately shelved.

The wave of market exits aligns with slowing global demand for webtoons. The explosive growth during the COVID-19 pandemic has normalized, while competition from platforms like YouTube, short-form videos, and OTT services has intensified. As a result, since 2022, the webtoon industry’s global momentum has slowed.

NHN has responded by exiting low-margin regions and focusing on select markets. It began with its withdrawal from Vietnam in July 2022, followed by the sale of its Thailand business in 2023 and its full exit from Taiwan in 2024, marking a complete retreat from Southeast Asia. In Europe, Pocket Comics Germany shut down in 2023.

NHN is not alone in struggling in global markets. Kakao Piccoma, Kakao's webtoon subsidiary, pulled out of France even earlier, dissolving its European branch in 2023. At the time, Kakao stated, “The market has grown more slowly than expected,” explaining that the company chose to focus on core regions instead. While France remains a major player in Europe, its overall revenue contribution still lags behind South Korea and Japan. This has led Korean companies to conclude that continuing operations there lacks business viability.

Naver Webtoon and Kakao Piccoma Shift Focus to Japan

In light of these developments, webtoon companies are redirecting efforts toward more profitable regions such as Japan and North America. Naver Webtoon saw a strong performance in Japan, which led global revenue growth. In 2024, its revenue from Japan reached USD 648.2 million—up 25.8% year-over-year—making Japan its largest market for the first time, surpassing Korea.

Growth was particularly strong for Naver's LINE Manga service. According to mobile analytics firm Data.ai, LINE Manga ranked No. 1 in global comic and novel app revenue across Apple’s App Store and Google Play in the second half of 2023.

To further improve profitability, companies are actively targeting new users. In North America, now considered a key emerging market, Naver launched a “Webtoon Video Contest” in January, leveraging TikTok and YouTube Shorts for viral marketing. Contestants were encouraged to produce short videos under 59 seconds based on popular series such as Mercenary Enrollment and Omniscient Reader’s Viewpoint.

Naver is also expanding global second-tier content businesses using webtoon-based intellectual property (IP), with webtoon-based dramas and animations actively being developed in North America.

Kakao Piccoma has likewise posted strong results in Japan. Since its launch in April 2016, Piccoma has provided over 160,000 titles, including e-books and webtoons produced in Korea, Japan, and China.

According to Data.ai, Piccoma ranked No. 1 in consumer spending among all apps in the Japanese app market in 2024. Its estimated consumer spend was USD 497 million, making it Japan’s top-grossing app for both 2023 and 2024—including games. When excluding games, Piccoma has maintained the No. 1 spot for five consecutive years since 2020.

Resumed Exports to Europe Highlight China’s Flexibility
U.S. Considers Major Deal to Ease Semiconductor Restrictions
Global Supply Chains Remain ‘Held Hostage’

In a global landscape increasingly shaped by strategic resource leverage, China has launched a pointed diplomatic offensive. By selectively reopening rare earth exports to Europe while continuing to withhold them from the United States, Beijing is signaling a new phase in its economic statecraft—one that fuses geopolitical influence with critical mineral control. This selective export strategy not only escalates indirect pressure on Washington but also reconfigures the balance of power in global supply chains.

As U.S. and Chinese officials gather for pivotal trade talks in London, speculation is mounting over whether the United States will ease semiconductor export restrictions in exchange for restored access to rare earth elements. The implications of such a deal are profound: rare earths are foundational to modern industry, powering everything from smartphones and electric vehicles to advanced defense systems. Yet, even before any agreement is inked, China’s strategy has already sent tremors through global markets, compelling countries to confront the urgent need for supply chain resilience and strategic autonomy.

U.S. Left Out of Export Resumption, a Tactical Move for Negotiating Leverage

On June 9, high-level delegations from the United States and China convened in London’s Lancaster House in a renewed effort to resolve their deepening trade rift. Present at the talks were U.S. Treasury Secretary Scott Bessent, Commerce Secretary Howard Lutnick, U.S. Trade Representative Jamie Greer, and Chinese Vice Premier He Lifeng, who led the Chinese side. Notably, this marked Lutnick’s first direct involvement in trade negotiations with Beijing—he had been absent from the previous Geneva meeting, where both nations agreed on a temporary 90-day tariff truce.

Lutnick’s presence was especially significant given his oversight of U.S. export control agencies. Diplomatic insiders anticipated that rare earth elements would top the agenda, especially after China’s recent decision to impose sweeping export restrictions. Since April 4, Beijing has enforced licensing requirements on the export of seven key rare earths—samarium, gadolinium, terbium, dysprosium, lutetium, scandium, and yttrium—along with related alloys, oxides, and compounds. These materials now fall under stringent review by relevant bureaus under China’s State Council.

In a further tightening of the grip, Beijing recently rolled out a new digital tracking system requiring online reporting of transaction volumes and customer details. These measures sharply increased regulatory oversight, effectively curtailing outbound flows of rare earths and reinforcing China’s control over one of the world’s most critical supply chains.

But amid growing backlash from global industry, and real-world production bottlenecks taking shape, China took a surprising turn. On June 7, the Ministry of Commerce announced the partial resumption of rare earth exports—though pointedly only to Europe. The Chinese government introduced a "green channel" designed to fast-track applications from qualified firms, accelerating review and approval timelines. Spokesperson He Yongchen defended the restrictions as in line with international norms, citing the clear military-civilian dual-use nature of rare earths.

The move is widely interpreted as a calculated gesture. By reopening exports to Europe while keeping the U.S. sidelined, China is offering both relief and leverage—signaling to Washington that the door to negotiation is still open, but on Beijing’s terms. For European automakers and battery manufacturers, the resumption brought immediate relief. For American technology and automotive companies, however, it deepened a sense of anxiety and vulnerability. In bypassing the U.S., China has made its message clear: rare earths are not just commodities—they are diplomatic instruments.

Caught Between Profit and Security: U.S. Walks a Strategic Tightrope

As China presses forward with its selective strategy, the United States is being forced to reconsider its own economic playbook. President Trump, speaking to reporters just before the London talks, emphasized the urgency of rare earth access, stating that securing these resources is a national priority. He hinted at a possible relaxation of semiconductor and chip-related export restrictions as a bargaining chip. Kevin Hassett, Chairman of the National Economic Council, was even more explicit, predicting that “all U.S. export controls will be relaxed” and China will resume rare earth shipments “in large volumes” following the negotiations.

But the prospect of such a trade-off has triggered fierce debate within Washington. On one side stand national security hawks, who argue that semiconductor export controls are essential for protecting America’s technological edge and curbing China’s access to critical technologies. On the other are pragmatic voices calling for flexibility—contending that without a stable rare earth supply, the United States risks cascading industrial shutdowns that would cripple domestic manufacturing.

These tensions reveal the depth of Washington’s strategic dilemma. The U.S. must not only decide whether to pursue a tactical exchange—easing chip exports in return for rare earths—but also confront a broader, long-term imperative: diversifying its resource base. Already, the Department of Energy and the Department of Commerce are spearheading efforts to build strategic partnerships with countries such as Canada, Australia, and mineral-rich nations in Africa. These moves are designed to reduce U.S. dependency on China and establish alternative supply chains.

Yet, such structural transformations take time. In the interim, Washington must navigate a narrow path between economic necessity and national security—a high-wire act in a world where minerals and markets are deeply intertwined with politics.

Shockwaves Across Auto, Semiconductor, and Battery Industries

Beyond Washington and Beijing, the global repercussions of China’s resource maneuvering are being felt with growing intensity. Nations and industries around the world are watching closely, knowing that if Beijing maintains its grip on rare earth exports, the global supply chain could seize up. These critical minerals are indispensable in virtually every strategic sector—from electric vehicles and renewable energy storage to advanced computing and military hardware.

The economic consequences are already unfolding in real time. Market research firm Argus Media reports that the prices of dysprosium and terbium—essential to the production of high-performance magnets—tripled between April and May. As of June 6, dysprosium was trading at USD 750 per kilogram, and terbium at a staggering USD 2,850 per kilogram, both more than twice their earlier prices. Yttrium, used extensively in defense systems, has surged nearly sixfold over the past two months, reaching USD 45 per kilogram.

These spikes underscore not just market volatility, but a broader structural vulnerability. Industry experts now describe the situation as a "compound crisis"—a fusion of geopolitical confrontation and fragile supply architecture. The weaponization of rare earths has elevated them from industrial inputs to tools of global influence, destabilizing markets and deepening economic uncertainty.

A spokesperson from Proterial (formerly Hitachi Metals), a Japanese specialty steel manufacturer, captured the growing concern, stating, “What used to be a problem solved by money is now determined by political alliances. We're entering a new era where access to rare resources depends on diplomatic alignment.” For tech-reliant nations like Japan and South Korea, the structural risks of supply disruptions are escalating—making diversification and stockpiling not just prudent policies, but national imperatives.

China’s selective resource diplomacy has added a new dimension to the global trade chessboard. By calibrating rare earth exports according to geopolitical interest, Beijing is not only safeguarding its own economic leverage but reshaping how nations define industrial security. For the United States, this marks a pivotal test—one that will determine whether it can adapt quickly enough to safeguard its manufacturing base and strategic interests, without compromising its global technological lead. In this unfolding drama, rare earths have become more than minerals—they are now catalysts for a new era of resource-driven diplomacy.

“Global Supply Chain Diversification Through Partnership with India’s Reliance”
“Accelerating 'Decoupling from China' Strategy in Response to Trump’s Tariff Pressure”
“Ultra-Fast Manufacturing System Built in Brazil Based on Guangzhou Model”

The global fashion supply chain is undergoing a quiet revolution. At the center of this transformation is Shein, the fast fashion juggernaut founded in China, now headquartered in Singapore, and known for redefining how garments are designed, manufactured, and delivered. With growing tariff pressures from the United States and the erosion of favorable import exemptions, Shein is no longer just optimizing its operations—it’s reconstructing its entire global footprint. The company’s latest pivot toward India as a manufacturing and export hub marks a bold strategic shift that echoes a broader industry trend: the rebalancing of global supply chains away from China.

India as the New Supply Chain Engine

In June, Reuters reported that Shein had formalized a major partnership with Reliance Retail, India’s largest retail group. The plan: create a robust local supply chain anchored in India that can serve as a launchpad for global exports of India-made Shein garments. Over the next 6 to 12 months, Shein aims to increase its number of Indian suppliers from 150 to 1,000, establishing a manufacturing base capable of feeding its vast global e-commerce platforms.

This initiative reflects months of behind-the-scenes negotiations between Shein and Reliance, predating recent U.S. policy shifts such as the proposal to eliminate the de minimis exemption on goods under USD 800 and the introduction of new tariffs on low-cost Chinese imports. While Shein currently sources products from over 7,000 suppliers in China, the looming policy changes have created a sense of urgency to reduce its dependency on Chinese manufacturing—particularly for its largest market, the United States.

Shein’s return to India is especially notable given its abrupt exit in 2020, when India banned Chinese apps in the wake of border clashes with China. However, the brand reentered the Indian market in February 2025 through a brand licensing agreement with Reliance, launching a revamped platform called “Shein India.” Unlike its previous app-based model, this version integrates deeply with local operations, production, and logistics—marking a far more embedded and strategic presence.

The division of labor between the two partners is clear and deliberate. Shein supplies the global toolkit—technology, trend forecasting, digital marketing, and design templates—while Reliance takes on the operational backbone: production, distribution, and data management. According to Shein’s official statement to Reuters, Reliance has been granted full brand usage rights within India and will oversee the entire local lifecycle of Shein’s operations, from manufacturing to market delivery.

Reliance has already inked contracts with 150 garment manufacturers and is in talks with another 400 suppliers to rapidly expand capacity. Crucially, the company is adapting Shein’s signature small-batch production model—a nimble method that produces just 100 units per design and scales up only when market demand justifies it. This helps minimize waste, avoid inventory gluts, and respond rapidly to consumer trends. A Reliance executive noted that the company is assessing the feasibility of reproducing Shein’s global bestsellers in India, and is willing to import fabrics and equipment if necessary to match quality standards.

Support from the Indian government has further smoothed Shein’s reentry. Commerce and Industry Minister Piyush Goyal lauded the partnership as a vehicle for creating a domestic supplier network that could boost Indian exports. Consumer reception has been robust: according to Sensor Tower, the new Shein India app has been downloaded 2.7 million times, and in the past four months alone, monthly downloads have grown by 120% on average. With 12,000 designs already available and prices starting as low as USD 4, Shein is positioned for a formidable resurgence in South Asia.

Vietnam, a Strategic Detour in the Tariff Maze

India may be the most visible leg of Shein’s strategy, but it is by no means the only one. In a bid to diversify its production and shipping corridors, Shein has leased a 15-hectare industrial site near Ho Chi Minh City, Vietnam, to establish a massive logistics warehouse. This facility is designed to serve as a central node for exporting apparel produced outside China to major markets such as the United States.

The logic is simple: Vietnam offers favorable trade agreements, proximity to Chinese suppliers, and relatively low labor costs. However, this workaround faces new geopolitical scrutiny. Washington has begun to intensify enforcement against transshipment, suspecting that Vietnam is being used to reroute Chinese-made goods and evade tariffs. The full implications for Shein remain uncertain, but any tightening of U.S. trade enforcement could complicate the brand’s efforts to use Vietnam as a detour.

Still, the warehouse represents a critical risk management move. Should tensions with China escalate or additional sanctions be imposed, Vietnam offers Shein a buffer zone and an alternate distribution channel—one that can insulate the company from single-market shocks.

Turkey and Brazil Rise as Regional Pillars

Complementing its pivots in India and Vietnam, Shein is also expanding production bases in Turkey and Brazil—each chosen for their strategic advantages. In Turkey, Shein has found a nearshore solution for the European and Middle Eastern markets. Its proximity to major consumer hubs in Europe allows for faster delivery, lower shipping costs, and evasion of EU-imposed tariffs on Chinese goods. Since 2024, Shein has ramped up partnerships with Turkish apparel manufacturers, growing the share of Turkish-made products sold in Europe.

Meanwhile, Brazil stands out as the crown jewel of Shein’s diversification strategy. Since early 2024, Shein has been building an entire localized manufacturing ecosystem in Brazil, leveraging its low-cost labor, enormous domestic market, and access to South America’s logistics network. The company successfully imported its hyper-fast production model from Guangzhou, reducing design-to-production lead time from 2–3 weeks to under 7 days. This model, combined with its localized small-batch production, allows Shein to rapidly test new products, minimize waste, and better serve fashion-forward consumers.

Shein has reportedly struck deals with over 2,000 local factories in Brazil and is now using this base not only to serve Brazilian consumers but also to export to the United States and other markets. The scale and speed of the operation have made Brazil a template for future expansion, embodying Shein’s vision of multi-polar manufacturing and agile supply chain responsiveness.

Federal-State Power Clash Escalates
“Worst Crisis Since the 1992 LA Riots”
Anti-Immigration Policies Spark Social Unrest

The mass protests erupting in Los Angeles have escalated into what is effectively a riot, marked by armed demonstrators, the display of Mexican flags, and incidents of civilian shootings. U.S. President Donald Trump has declared the unrest a “rebellion” and formally authorized the deployment of suppression forces. His stance stands in stark contrast to that of the California governor, revealing deep divisions over how to respond. What began as a backlash against Trump’s hardline anti-immigration policies has now evolved into a broader expression of anger—one fueled not only by undocumented immigrants but also by the frustrations simmering across the low-wage labor market in the United States.

“Insurrection or Human Rights?” — A Nation Divided

On the 9th (local time), U.S. Northern Command released a statement on its official website, announcing, “We have activated a Marine infantry battalion that had been on standby over the weekend,” adding, “Around 700 Marines from the 2nd Battalion, 7th Marine Regiment, under the 1st Marine Division, will support Title 10 forces protecting federal personnel and property in the Los Angeles area.”
Title 10 refers to federal troops deployed under a U.S. law that allows the president to send military forces into a state without the governor’s request.

Just two hours prior to the Northern Command’s announcement, President Donald Trump had been asked by the press whether he intended to send in Marines following the National Guard to quell the LA protests. He responded, “We’ll see how things go,” asserting that “we are controlling the situation well,” and claiming that had he not ordered the deployment of the National Guard, “things would have gone very badly.”
Though leaving open the possibility of deploying additional forces, he had implied that such a move would be delayed.

Trump’s sudden change of plans is largely seen as a direct result of his ongoing clash with California Governor Gavin Newsom. Labeling the situation “not a protest but a rebellion,” Trump ordered a forceful crackdown and even issued instructions for the arrest of demonstrators wearing masks.
In contrast, Governor Newsom has insisted that “freedom of expression must be protected,” maintaining a restrained approach toward crowd control. This has created a stark confrontation between the federal and state governments. Trump has not hesitated to publicly lambast Newsom, calling him a person who is “neglecting law and order.”

This conflict starkly illustrates the growing tensions over authority between federal and state governments in the U.S. While the federal side pushes for aggressive measures—like deploying troops—to restore order, the state government focuses on containing the unrest with minimal use of police force.
From Trump’s perspective, this amounts to a national security threat, and Newsom’s handling of the situation borders on constitutional negligence. On the other hand, Newsom’s camp has dismissed the federal intervention as a “political performance,” decrying it as an infringement on state autonomy.

Mexican Flags and Breakdown of Public Order

The protests in Los Angeles, which began on the 6th in response to intense crackdowns by U.S. Immigration and Customs Enforcement (ICE) on undocumented immigrants, have escalated far beyond simple marches and chants. Eyewitnesses have described the events as bordering on full-blown riots.
Some demonstrators appeared on the streets armed with rifles, prompting the California state government to urgently deploy 300 National Guard troops to restore order. Protesters demonstrated coordinated discipline as they clashed physically with police forces.

Tensions intensified even further following President Trump’s remarks endorsing a forceful crackdown. The federal government went so far as to officially mention the possible invocation of the Insurrection Act—a law enacted in 1807 that grants the president legal authority to deploy military forces in response to rebellion or civil unrest. Invoking this law would signal both a state government failure and a declaration of national emergency.

The last time the Insurrection Act was used was during the 1992 Los Angeles riots, which followed the police beating of an African American man. In that case, a large-scale deployment was carried out at the request of the California governor, and around 4,000 troops were mobilized.

What makes the current crisis particularly symbolic—setting it apart from previous anti-government protests—is the presence of Mexican flags in the hands of demonstrators, not American ones. This striking image goes beyond mere opposition to government policies—it reflects a direct assertion of political identity and discontent from within immigrant communities in the U.S.

The sight of foreign flags being waved on American soil has inflamed conservative outrage and rapidly fueled the perception that “non-Americans” are causing chaos in the country. This symbolism is part of what led President Trump to define the situation as an outright rebellion.

Protests Escalate as Direct Backlash to Immigration Policy

At the heart of the increasingly violent LA riots lies President Donald Trump’s hardline immigration agenda, which he has pushed since his candidacy. From the outset of his administration, Trump has made the deportation of undocumented immigrants a central priority—pursuing an aggressive crackdown that ranges from building a border wall to large-scale immigration raids. More recently, enforcement has expanded dramatically, shifting from targeting violent offenders to including undocumented workers lacking employment visas. Tom Homan, the administration’s chief immigration official, declared that the country would witness “unprecedented levels of workplace raids”—a warning that is rapidly becoming reality.

The core issue, critics argue, is that these policies have spread widespread hostility and systemic discrimination against immigrant communities. Over time, this social undercurrent has reached a boiling point—erupting in the form of riots.

Reports indicate that the majority of those participating in the protests are either non-citizens or individuals with undocumented family members. The Trump administration’s intensified crackdown has effectively relegated these individuals to the status of “second-class citizens” in American society. Protesters consistently point to this sense of identity loss and existential threat as the root cause of the current unrest.

Discontent with the administration’s immigration policy extends well beyond immigrant communities. Many small business owners and low-wage employers are also voicing concerns over labor shortages and operational disruptions caused by the crackdown.

According to Goldman Sachs, as of 2023, approximately 4% of America’s 170 million workers were undocumented immigrants without employment visas. These workers—largely concentrated in construction, agriculture, and other low-wage sectors—have long propped up the outer edges of the U.S. economic ecosystem. The ongoing riots reveal that the crisis is no longer confined to street-level clashes but now poses a deeper threat to the cohesion and stability of entire communities.