Bessent: U.S. Must Control Its Own Destiny, No Choke Points in Supply Chains | China in Focus

Welcome to China In Focus, I'm Tiffany Meyer, our top story. The U.S. is pledging to secure critical supply chains from rare earths to shipbuilding to counter China. President Trump is pushing is for us to be able to control our own destiny and not have any choke points in our supply chains. Secretary of War Pete Hegseth in Asia meeting with his counterparts from America's biggest threat China as well as from allies. We don't seek confrontation but of course we're ready to protect our interests individually and mutually. Japan's new prime minister faced off with Chinese leader Xi Jinping while strengthening ties with the U.S. She raised concerns over key issues despite Beijing's red lines. A former U.S. army intelligence sergeant has been sentenced for selling national defense secrets to China. What information did he hand over? We have the details. Treasury Secretary Scott Bassin says the U.S. aims to take control of critical supply chains from rare earths to medicine and shipbuilding. His comment on Thursday came after President Trump's trade talk with Chinese regime leader Xi Jinping. We're going to be taking control of our supply chains in rare earths, in semiconductors, in medicines, in steel, in shipbuilding. You know, part of the America First agenda that President Trump is pushing is for us to be able to control our own destiny and not have any choke points in our supply chains like he inherited. Bassin confirmed the U.S. will suspend a new rule for one year in exchange for China pausing its latest rare earth export restrictions. The rule now on hold was designed to close a loophole that let China tap into American technology to strengthen its military. In the past, when the U.S. put a Chinese company under export controls, that company would often set up new subsidiaries to continue accessing U.S. technology. The new rule aimed to block any subsidiary that's at least 50 percent owned by a company that's already blacklisted by the U.S. During Trump's Asia tour, the U.S. and Japan agreed to a deal on new generation nuclear power reactors in rare earths. Bassin said Trump wants to bring back nuclear power to compete with China. The Chinese are building nuclear plants. They're starting them up every month, and we are behind. But under President Trump's leadership, we're going to catch up. U.S. Trade Representative Jameson Greer said the trade talks didn't solve every problem in the bilateral relationship. There are a lot of issues with U.S. companies operating in China or trying to operate in China that are not resolved. He said the Trump-Xi meeting was really about making sure rare earths can keep flowing to the world, China can resume buying U.S. agricultural products, and crack down on fentanyl. Greer said the U.S. would continue its investigation into China's compliance with the phase one trade agreement during Trump's first term. He added the one-year pause in the trade war is just a confidence-building step, and the U.S. has other options if it doesn't pan out. Secretary of War Pete Hexeth met with his counterparts from several countries on Friday, including China and India, on the sidelines of the Asian Defense Summit. The face-to-face sit-downs in Malaysia come as Washington aims to boost regional security ties. We don't seek confrontation, but of course we're ready to protect our interests, individually and mutually. And that's why we're publicly announcing the Task Force Philippines here with you today, which will be another step in our cooperation. I'll just say real quick, I want to express the gratitude to the minister, Minister Singh, for his time, for the partnership we have with India. It's one of the most consequential of the U.S.-Indian relationship in the world. And our strategic alignment is built on shared interests, on mutual trust, and a commitment to a secure and prosperous Indo-Pacific, which is precisely the conversation we had. It was the world's oldest democracy and the world's largest. And this new 10-year defense framework we signed is ambitious. Hexeth called the 10-year defense cooperation with India framework a cornerstone for regional stability and deterrence. On China, Hexeth said on X that he told Beijing's representative the U.S. would stoutly defend its interests and maintain the balance of power in the Indo-Pacific. He also voiced concern about Chinese activities in the South China Sea and around Taiwan. The Philippines and the United States have formed a new joint task force to strengthen cooperation and increase military readiness. Its area of operation will also include the South China Sea. Taiwan is rejecting Beijing's latest push to bring the island under China's control. On Friday, President Lai Ching-de said Taiwan will never accept Beijing's one-country, two-systems model that's used in Hong Kong. He told troops at a military base that only strength brings peace. The remarks come as Taiwan commissions its first battalion of American-made Abrams tanks. We must remain dignified and determined, maintain the status quo and resolutely oppose annexation, aggression, oppose the promotion of unification and one country, two systems. This is because we will always uphold a free and democratic constitutional system. Taiwan purchased 108 M1A2T Abrams tanks from the United States as part of a broader effort to upgrade its defence capabilities. The first batch of 38 tanks arrived late last year and completed live fire exercises in July. A second shipment of 42 tanks arrived this past July and the final batch of 28 is expected early next year. The Abrams tanks join another high-end US weapons system including upgraded F-16V fighter jets and HIMARS missile launchers. The Taiwanese president has vowed to raise the island's defence spending to 5 percent of GDP by 2030. Japan's new Prime Minister Sanae Takaichi held her first meeting with Chinese leader Xi Jinping during the APEC summit in South Korea on Friday. Takaichi acknowledges that Tokyo and Beijing still face many unresolved issues but says she hopes to reduce tensions and keep communication with Xi. Both sides have agreed to move forward with what they called a strategic mutually beneficial relationship. Their conversation lasted roughly 30 minutes. China brought up the issue of Taiwan early in the talks. Xi made some remarks about Taiwan so I told him that maintaining a good China-Taiwan relationship is extremely important for regional stability and security. Takaichi also pushed back on Beijing's red lines regarding human rights in Xinjiang and Hong Kong. She also challenged China on activities near the disputed Senkaku Islands and rare earth export controls threatening global supply chains. Japan pressed Beijing to ensure the safety of its citizens there and lift bans on Japanese seafood and beef. Meanwhile, Xi Jinping urged Japan to view the two countries' relations through an historical lens. He referenced former Prime Minister Tamaichi Murayama's deep remorse for Japan's wartime aggression. Takaichi, dubbed Japan's Iron Lady, has taken a firm foreign policy stance. She's working closely with allies, especially the U.S., to maintain regional geopolitical balance. That comes as China pushes to reshape the global order and challenge Western democracies. Notably, after her election, Xi broke tradition by not sending a personal congratulatory message. Instead, he delegated the task to Chinese Premier Li Qiang. Observers noted a stark contrast in tone. Takaichi appeared to warmly regard President Donald Trump earlier this week, but she was visibly reserved with Xi. China agreed to delay its recent rare earth export controls after the Trump-Xi meeting, but restrictions from April will remain in effect. Beijing's recent restrictions would have made it hard for countries to obtain Chinese technology and equipment to develop their own rare earth refineries. April's rules limit exports of seven rare earth metals, including magnets vital to automakers, defense firms, and chipmakers. They also force some automakers to halt production at several plants. What are rare earths, why are they important, and how has the U.S. been playing catch-up? Here's a breakdown. Rare earths are metals, a group of 17 elements on the periodic table. They're used in almost all modern technology, from iPhones to Tesla motors to almost every advanced weapon. China mines 70 percent of the global rare earth supply. Altogether, the U.S., Brazil, India, Australia, Russia, Vietnam, and Greenland have similar amounts of rare earths as China. But China processes over 90 percent of the world's rare earths. Earlier this year, China restricted rare earth exports to the U.S. in retaliation for Trump's tariffs. As a result, Ford paused production at a Chicago plant for a week. Automakers in Europe and Japan also faced supply disruptions. The U.S. has been playing catch-up. Treasury Secretary Scott Besson said they plan to take up more control in strategic sectors to combat China. That's by taking more equity stakes in key companies. The Department of War has agreed to buy a 15 percent stake in MP Materials, a U.S. company that mines rare earths in California. Besson said the U.S. also needs a strategic stockpile of critical minerals, similar to its strategic petroleum reserve. That's the nation's emergency oil supply for times of shortage. President Donald Trump signed critical minerals agreements with four Southeast Asian countries and Australia to increase rare earth supply. A former U.S. Army intelligence sergeant on Tuesday was sentenced to four years behind bars. That's for selling national defense secrets to China. His name is Joseph Schmidt. He used to have top-secret clearance while working at a military base in Washington state. After being discharged, he kept a device that gave him access to secure military computer networks. He later gave the device to Chinese authorities. In 2020, Schmidt flew to Turkey. Court documents show that while there, he searched online about defecting from the U.S. Schmidt later lived in China. While there, he attempted to visit China's Ministry of State Security, which is the regime's intelligence agency, in person. Schmidt was arrested in 2023 after flying back to the U.S. He was referred for mental health treatment. The judge said he considered Schmidt's mental health and the seriousness of the crime when sentencing him. Another case likely related to a Chinese spy, China is scheming a wide-ranged honeypot network targeting Western elites. That operation focuses on governmental officials, tech executives, and anyone the Chinese Communist Party wants to influence. Reports say European intelligence is investigating a former political reporter's ties to Beijing to find out if they were actually a Chinese spy. European news site Euractiv knows who the reporter is, but cannot release details while the investigation remains in its early stages. Three spy agencies told the news network that the person used their status as a journalist to reach their targets. At times, they even used seduction as a tactic. According to the intelligence agencies, the individual's targets were mainly officials working in Brussels-based international groups. The former political reporter is based in Belgium's capital, Brussels. It's unclear if the espionage investigation prompted their exit from the newspaper. The individual didn't respond to media inquiries. A political spokesperson said they won't comment on their former employee's departure, adding that authorities haven't contacted the paper. Just last week, the Times reported that Russia and China are sending attractive young women to Silicon Valley. At times, they target American tech elites to gain access to cutting-edge intellectual property. An IT executive who has decades of experience in espionage said he became a target himself. He cited mounting LinkedIn requests he recently received from But the threats don't just stay in the cyber world. The executive revealed that two Chinese women tried to enter a business conference on China investment risks, but were turned away by security. This comes as multiple Chinese nationals have recently been charged or sentenced for espionage. Nvidia CEO Jensen Huang says he's hopeful the company's latest cutting-edge black walt chips can one day be sold in China. He added that President Trump will have the final say in green-lining the exports. Huang's been pushing back against U.S. restrictions, arguing they'll only help Chinese competitors like Huawei catch up faster. Here's what he told reporters on Friday. The China market is large and it's a vibrant market with a lot of developers. And those developers create AI technology that's exported from China all over the world. And so to the extent that American tech stack can run and to operate those AI models, it's good for the United States around the world. After Thursday's summit with China, Trump confirmed that semiconductors were on the table, but he clarified that Nvidia's black walt chips weren't part of the talks. U.S. Trade Representative Jameson Greer chimed in, saying the black waltz are considered crown jewels of American innovation. Greer added that it is unlikely to be part of future negotiations with China. Nvidia argues that expanding its presence in China could actually limit major Chinese tech firms from competing globally. But some U.S. officials and analysts warned that giving Beijing access to this technology could strengthen China's military and pose a national security risk. Coming up, a trade deal between the U.S. and China. But what should the U.S. do to make sure Beijing is following through? We're doing with the Japanese, you know, our partners and allies on these investment agreements. So why shouldn't we do this with Chinese to have sort of a lot more oversight? And cyber expert Rex Lee joins us to unpack the psychological aspects of TikTok as its fate hangs in the balance. How have criminal organizations infiltrated the app? And what can parents do to protect their kids? More on that after the break here on China In Focus. Welcome back to China In Focus. I'm Tiffany Meyer. The leaders of the U.S. and China have agreed to a trade deal earlier this week. But communist China has a history of not keeping its promises on trade deals. The most recent example is the agreement President Trump made with China during his first term. How will the U.S. ensure that China actually follows through this time? We spoke with Riley Walters, senior fellow at the Hudson Institute, for his insight. The problem that they had with the first trade deal that they had with China was there wasn't a mechanism involved that kept tabs on how China is purchasing, whether it's keeping up to a steady purchase commitment that it made during the first Trump administration, whether it was more U.S. agricultural products, more U.S. manufacturing. The first U.S. trade deal with China was essentially China has to buy all these goods within two years. And because of COVID, everything basically fell apart. And so I think one of the key points of whatever trade deal that comes out of this is going to be the necessity to have this sort of checks and balances to make sure that even if the Chinese say they're going to do something, are we going to follow up on that? Are we actually going to monitor that? What happens if they fail? Put that language in a deal. Say, we're doing with the Japanese, you know, our partners and allies on these investment agreements. So why shouldn't we do this with the Chinese to have a lot more oversight of these deals that we're supposed to be signing? Last week, the U.S. launched an investigation into what it calls China's apparent failure to uphold the phase one trade deal signed in 2020 during President Trump's first term. Under the agreement, Beijing promised to buy $200 billion in U.S. goods and services each year for at least two years. But China never met those targets, blaming the COVID-19 pandemic. No more broadcast to China. Radio Free Asia says it's suspending operations for the first time in its history, setting funding uncertainty amid the government shutdown. Executives say the broadcaster will halt all production on Friday to conserve resources and preserve the chance of restarting if funding returns. Radio Free Asia is funded through the U.S. Agency for Global Media. It lost much of its budget after funding cuts earlier this year. The outlet was established in 1996. It reached nearly 60 million people in communist-ruled countries without press freedom, like China, North Korea and Vietnam. Questions over TikTok's fate remains. Treasury Secretary Scott Besson says China approved the transfer agreement for TikTok, adding that he expects it to move forward in the coming weeks and months. Meanwhile, China's commerce ministry said it properly handled TikTok-related issues with the U.S. Joining us to dig into the psychological aspects of the app, especially its impact on young minds, is Rex Lee, cybersecurity advisor at MySmartPrivacy. Rex Lee, thank you so much for joining us. Great to have you back on the show. Thank you for having me on the show, Tiffany. One way a lot of young people are staying connected with their heroes or stars or people they look up to is through TikTok. Talk to us about the psychological divide, if you will, between TikTok that we use here in the U.S. versus doing China's internal version. Yeah, it's amazing because they're both owned by ByteDance. And TikTok today, operating as is, is still owned by ByteDance. The deal hasn't been closed at all. And as you know, we went over the deal. ByteDance is still going to retain 20 percent minority ownership in the U.S. TikTok. So it's not really a U.S.-owned TikTok when 20 percent of it's still going to be owned by ByteDance. And they get 10 to 20 percent of the revenue kicked back to them for the use of the algorithm because they own 100 percent of the algorithm and they're only licensing it to the new company. So you're still going to have a China influence. And then if you look at what or how TikTok is programmed for not just the United States, but every country outside of the United States, it's everything goes. You know, they're promoting human trafficking. These platforms like TikTok have been infiltrated by these criminal organizations. So they're recruiting. Like here in Texas, we see a lot of stories about teenagers that were recruited to go down to the border and make a quick buck through human trafficking over the Biden years and actually or be a drug mule and make money through that. You'll see all that type of stuff that's being promoted on TikTok, the TikTok challenges that have harmed kids and bad behavior. Well, Douyin in China, which is TikTok in China, it's promoting good behavior. It's promoting academics. It's promoting sports. It actually has a time limit that will cut. It's a hard cutoff. Again, you can be indoctrinated with a political ideology through the platforms. Likewise, there's political indoctrination being influenced through the U.S. version of TikTok as well. And we see that regarding tech based hybrid warfare today. And with all that you cover, what would be your advice to parents or even kids who are concerned about maybe being influenced through these types of technologies and with the betting on the side, what would be your advice? My kids are grown up today. If there were 10 years ago, they would never see a smartphone until they're 18 years old. I wouldn't even prohibit them from being on social media. They just would not have the technology to access social media through a mobile device. Whereas a desktop computer, a parent can monitor and maybe put some guidelines on the kid regarding screen time. There's a movement within Gen Z where dumb phones are becoming popular because they're tired of it. They know they've been indoctrinated. They know they've been addicted to tech. And there's a movement toward that. So you can forget government trying to protect these consumers and children from all of this because of the lobbying that's going on on K Street. The money's too big. It'll come back on the parent to have accountability for their children rather than depending on the government. Definitely a lot at stake here for sure. Rex Lee, as always, thank you so much for joining us. Thank you. That's all for today's China In Focus. I'm Tiffany Meyer. If you have any feedback on the show or have something you'd like to see us cover, send us an email at ChinaInFocus at NTD.com. 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