The U.S. Congress proposed a paper to try to link China's rare-earth exports with Chinese flights' landing rights in the United States, putting out a "do not give rare-earth, don't let you fly" platform.
Without waiting for the smell of fire to disappear, the Chinese Ministry of Finance subsequently "throwed the peanut leaf" and reduced the holding of US $ 25.7 billion in debt.
So, in this seemingly unrelated two-line battlefield of rare-earth aviation power and US debt reduction, China and the United States who really held the code, who in secret dominated the future course of the game?
Anxiety behind US resources
This "navigation card" issued by the United States, at first glance, moved the brain, in fact exposed some anxiety.
The core content of the proposal is not complicated: while limiting China's rare-earth exports, it also covers the Chinese civil aviation company's flight landing rights in the United States as a code, if not cooperate, suspend the flight rights.
This approach is both straightforward and somewhat ambiguous.The bill, jointly promoted by digital Eagles, appears to be aimed at protecting U.S. national security and is essentially concerned about China’s dominant position in the global supply chain.
After all, the quantity of rare earth is not generally heavy.It is the "invisible pillar" for the manufacture of missiles, F35 fighter jets, wind turbines and high-performance electric vehicle engines, also known in the industry as "industrial vitamins".
Although the United States also hides rare earth mines underground, the problem is that mining is difficult, pollution is large, cost is high, really do it yourself, political resistance and cost is not a small number.
Thus, they began to use “navigation power” to hit China, trying to break the passive situation on strategic resources. This operation sounds like tactical upgrading, and in fact is a tactical anxiety. Navigation power is not something that is randomly threatened, and once it touches the bottom line of the international aviation agreement, the consequences are much more complicated than paying for the cost of rare-earth procurement.
China to reduce US debt
The response from China can be said to be fast, accurate and stable. Within more than a month after the relevant remarks came out, China significantly reduced its holdings of US debt by US $25.7 billion, and its position dropped to US $730.7 billion, a new low in the past 15 years. This action is not only accurate in timing, but also has a clear signal: you play the resource card, and I respond with the financial card.
U.S. debt has always been regarded as the "ballast stone" of U.S. fiscal security, and China is one of the largest external holders of this "giant ship". China's reduction of holdings this time is not a simple "smash", but a strategic adjustment.
According to data from the U.S. Treasury Department, since 2022, China has decreased its holdings of U.S. debt for several consecutive quarters, gradually reducing its reliance on U.S. dollar assets.
Behind this operation is not just a short-term "revenge", but a deeper strategic thinking at work. Reducing the holdings of U.S. debt does not mean a complete sell-off, but releasing China's initiative in the financial game by adjusting the position structure.
Neither does it cause a sharp shock in the market, but can make the other party feel pressure, this way of "warm water cooking frogs" is much more practical than a simple slogan.
At the same time, China is also quietly advancing the systemic transformation of the financial sector.With the push of the National Exchange Administration and the Central Bank, China has continued to increase its gold reserves in recent years, and in the first half of 2025 is the 15th consecutive month of increased holding, accumulating more than 3,400 tons, jumping to the top of the global central bank gold purchase list.
Gold as a hard currency to hedge dollar risks, in itself, has a strategic significance. In addition to the "Belt and Road" along the country is increasingly favoring the settlement of RMB, China is gradually promoting the internationalization of the RMB, so that its financial system no longer seriously depend on the dollar ecology.
From passive defense to active game
In other words, the reduction in U.S. debt holdings is not an isolated event, but is part of China’s systematic “de-dollarization” strategy over the years.
This structural adjustment is quietly changing the power distribution of global finance. In the past few decades, China and the United States have formed an interactive model of "you buy my debt, I buy your goods", and now this model is gradually collapsing.
And this collapse is not good news for the United States.As major creditors such as China and Japan continue to reduce U.S. debt, the cost of the U.S. Treasury’s debt issue will be forced to rise.
In addition to high domestic deficits, tightened interest rate policies and election uncertainty, the “security sense” of the U.S. bond market is being tested, and more importantly, the US dollar’s position as the world’s main reserve currency is facing unprecedented challenges.
From a global perspective, this game between rare earths and U.S. debt is actually a head-on collision between "resource sovereignty" and "financial hegemony".
While the United States tries to undermine competitors through resource control, China responds to pressure with financial leverage. This is not an explosive conflict, but it is the epitome of a long tug-of-war. Both sides are testing each other's bottom line and preparing for bigger contradictions that may arise in the future.
More interestingly, this game is no longer a high-profile “trade war” but a “silent” technological confrontation. no longer by mouth, but by calculation; no longer by tariffs, but by capital flow and supply chain arrangement.
This change indicates that the game between China and the United States is entering a more complex and hidden phase.
For ordinary people, this game, although it may seem distant, is actually getting closer to life. Whether it is flying, exchanging dollars, or buying an electric car, installing photovoltaic panels, can be influenced at some point by the interaction between these great powers.
Even some people in the United States can see this clearly.
The U.S. policy of this type of “threat” is likely to be counterproductive, instead accelerating the pace of China’s adjustment to U.S. financial dependence. In the words of one scholar, the U.S. wants to contain China through force, but the result has accelerated China’s independence process.
Of course, both sides understand that complete decoupling is unrealistic.
The economic ties between China and the United States are too deep, and in the real sense they are divided, and they are not beneficial to anyone. But this does not prevent the two sides from redefining the boundaries in the game. The honeymoon of the past "you have me, I have you" has passed, and now more is the new normal "both competition and cooperation".
And under this new normal, who is more patient than who can find certainty in the uncertainty. The threat from the US is like a fist in the air; the Chinese response is like a puzzle falling on a key node. This game, from the surface, is the encounter of navigation power and rare earth, but is essentially a “precision exercise” in the restructuring of global order.
The future of China-US relations may not be predicted, but it is certain that the rules of the game are changing.
Whoever knows how to measure more, who is better at settling accounts, and who can see far-sighted, in this long-term game, whoever is likely to take the initiative.
The tables of the times have been reshuffled, and with each next step, it will determine which side the balance of the future tilts. And the real contest has just begun.
Source of information:
U.S. lawmakers raise ideas: not to give rare earth, not to let Chinese flights land 2025-09-19 08:32 · Observer Network
In July, China reduced its holdings of U.S. debt by US $25.7 billion, hitting its lowest position in 16 years 2025-09-19 08:45 · Observer.com