Rare earths commonly refer to 17 elements (mostly metals) that are scattered in low concentrated deposits and are hard to extract.
Used in all types of high-tech products, rare earths make up a great part of our everyday lives.Neodymium, one type of rare earth element, is used to make powerful magnets contained in speakers, hard drives, microphones, wind turbines, and hybrid cars.
Another rare earth, lanthanum, is used in camera lenses; cerium is used in cars and in colored glass; yttrium is used in television sets and in some cancer treatment drugs.All of these products are ones we couldn’timagine living without.
With natural resources close to zero, Korea has a poor environment for economic growth. A high population density and low birthrate hindered Korea from building a large, stable internal market. This led Korea to become an export-oriented, technology-based nation. That worked well for Korea and eventually made the country a leader in industry.
However, this type of economy has its limits: it became very dependent on trade incomes and resources from other countries. Most of the raw materials for automobiles, ships, and IT products made in Korea are imported from other countries.
Rare earth elements are one of these import products, and with the growth of Information and Communication Technology (ICT), they are increasing in demand. Korea’s industry is all about these high-tech products; the increase in rare earths demand will stand out especially in Korea.
A crisis occurred a few years ago when China, responsible for 97% of the supply of rare earths at the time, announced that they would start reducing their exports of rare earths,according to National Geographic. This caused panic in all the leading companies of cutting-edge products.
China’s monopoly on rare earths seemed to weaken whenthe World Trade Organization (WTO) pressured them to remove the restrictions on rare earths exports. As a result, China’s export quota system was removed on January 2015. Later this year, a tariff of 15-25% is expected to be removed, as well. Still, China’s domination of the rare earths market continues with more government control over the market due to restrictions on their export licensing system–and they still control roughly 90% of the market.
Korea’s dependency may have a solution: North Korea. Deposits in Jongjuare estimated to hold about 216 million tonnes of rare earth elements, which are theoretically worth trillions of dollars. According to Voice of America, North Korea could become the “game-changer to challenge China’s monopoly.” North Korean rare earths exports to China dramatically increased between 2013 and 2014, all at cheap prices.
As seen from the atrocious punishments imposed on some “traitors,” the Pyongyang regime is focusing on maintaining itself. By cheaply providing them to China, Pyongyang is using their rare earths resources to continue its survival, not development.
However, it’s clearly a great loss to sell off such valuable goods. If South Korea and North Korea work together to exploit these resources, it would benefit both countries.
For South Korea, a stable and inexpensive rare earths supply would give South Korean high-tech products greater price competitiveness. North Korea will be able to make developments in their industries, which would help to strengthen their economy. Rare earths in North Korea may be one more reason why both countries should cooperate and think again about reunification.
Rare earths are crucialfor the next generation of green energy and personal technology. While China has taken over the rare earths market, the fact that North Korea has plenty of it may be an opportunity for us.
By Curie Park, Daedeok High School
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