Trump's new travel ban set to take effect amid escalating tension over immigration enforcement

China appears to have offered U S and European auto giants something of a reprieve over a rare earth shortage China s Ministry of Commerce on Saturday reported it was willing to establish a green channel for eligible rare earth export license applications to expedite the approval process to EU firms Maximilian Butek an executive director and board member of the German Chamber of Commerce in China declared the progress is certainly good news for European businesses China appears to have offered U S and European auto giants something of a reprieve after industry groups warned of increasing production threats over a rare earth shortage China s Ministry of Commerce on Saturday explained it was willing to establish a so-called green channel for eligible export license applications to expedite the approval process to European Union firms A Ministry of Commerce spokesperson disclosed Wang expressed hope that the EU would take reciprocal approaches and adopt measures to promote compliant bargain of high-tech products with China The breakthrough comes after transaction talks between Chinese Commerce Minister Wang Wentao and EU Commerce Commissioner Maros Sefcovic met in Paris France last week Beijing also granted rare earth licenses to suppliers of U S auto giants General Motors Ford and Jeep-maker Stellantis Reuters stated on Friday citing unnamed sources The account commented China s Ministry of Commerce did not respond to a faxed request for comment CNBC has contacted GM Ford and Stellantis Read moreAuto industry sounds the alarm as China s rare earth curbs start to biteTrump-Xi call isn t enough to resolve looming critical mineral shortage this summerThe West is recycling rare earths to escape China s grip but it s not enough China s Ministry of Commerce in early April imposed export restrictions on several rare earth elements and magnets widely used in the automotive defense and vigor sectors The curbs were part of a response to U S President Donald Trump s tariff increase on Beijing s products Various of the affected rare earth elements were critical components to the production of both combustion engines and electric vehicles Maximilian Butek an executive director and board member of the German Chamber of Commerce in China explained the weekend announcement was certainly good news for European businesses but noted that it remains unclear whether the fast-track channel applies to large-scale firms or to sectors more broadly It is a huge bureaucratic monster that they ve created and I m not sure if they really can now speed up the process and give the licenses to those who need them Butek advised CNBC s Europe Early Edition on Monday Europe s top automakers will welcome the diplomatic breakthrough Butek mentioned while stressing the European bloc s need to improve supply chain diversification Stringer ReutersWorkers transporting soil containing rare earth elements for export at a port in Lianyungang Jiangsu province China Oct It all hit us quite by surprise that China is even willing to draw this card because this is a retaliation measurement towards the tariffs the U S implemented right And we as European companies we are now in the crossfire of this bargain escalation and this is really not where we want to be Butek disclosed It is not enough just to announce it but they have to show it he added China s critical mineral dominance China is the undisputed leader of the critical minerals supply chain accounting for roughly of the world s production of rare earth minerals and materials U S executives have previously warned that this dominance poses a strategic challenge amid the pivot to more sustainable resource sources Specific analysts have compared the industry-wide squeeze on supplies of rare earth magnets to the global semiconductor predicament that disrupted automotive production during the coronavirus pandemic Speaking to CNBC before China released plans to expedite the approval process of rare earth exports to the EU the European Automobile Manufacturers Association ACEA stated selected of its members were at pitfall of production outages starting as soon as next month The car lobby group which represents the likes of Stellantis Renault Ferrari Volkswagen and Volvo reported rare earth export licenses by China s Ministry of Commerce had been taking a important amount of time to process since the April restrictions came into force Generally global stocks of these magnets are quite low And given that China is the bulk global supplier it has meant that in the absence of these export licenses those stocks have been depleting progressively since the start of April Jonathan O Riordan international deal director at ACEA notified CNBC by phone We re gradually coming into a very very critical moment whereby those stocks are now being exhausted and we are potentially going to see production stoppages he added Florian Wiegand Getty Images News Getty ImagesA general view of production lines at the Mercedes-Benz assembly plant on June in Rastatt Germany ACEA s warning followed a separate ominous update from the European Association of Automotive Suppliers Last week the group announced that several auto supplier plants and production lines had already been shut down due to Beijing s latest export restrictions with further outages expected as rare earth inventories deplete over the coming weeks Japanese automaker Suzuki Motor however suspended production of its Swift car due to China s rare earth curbs Reuters stated Thursday citing two unnamed sources A Suzuki Motor spokesperson did not respond to a request for comment when contacted by CNBC Demand for rare earths and critical minerals is expected to grow exponentially in the coming years as the clean resource transition picks up pace