Mineral Export Restraints and Sustainable Development--Are Rare Earths Testing the WTO's Loopholes?

China's actions in limiting the export of rare earths have drawn the world's attention. The USA, Japan, and the European Union (EU) have been frustrated with China's measures, even threatening to bring the case to the WTO. These rare earth trade disputes are but the tip of the iceberg. Forms of export restraints on minerals have been increasingly practiced by developing countries, reflecting developing countries' determination to upgrade their own economic condition against a broader backdrop of international economic transition in a mineral-hungry world. Such issues of mineral export restraints are deeply rooted in the traditional international trade structure, and in turn serve as a historic move to break it. The WTO's consensus-based approach, with developing countries comprising more than two-thirds of WTO membership, has to accommodate this changing situation in both its judicial and negotiation scenarios. Accused of being trade-distorting and inconsistent with the WTO Agreement on the part of mineral export restraints, developing countries expect to defend themselves by reasons of environmental protection and conservation of exhaustible natural resources. This article anticipates that, in the next round of multilateral negotiation, the developed world will attempt to bring the issue of export restraints under multilateral mandates. Oxford University Press 2011, all rights reserved, Oxford University Press.