The European Union wants to stay competitive in a global marketplace and not be too beholden to third party countries for essential critical raw materials. Here is how the EU is hoping to secure those important supplies.
The European Commission is scheduled to publish a new economic security plan next week, which will include a critical resources strategy, known as RESourceEU. The strategy is modelled after the rather successful energy-focused REPowerEU.
It is a reaction to a number of geopolitical changes currently playing out around the world, which include but are not limited to China continuing its domination of clean tech industries and its imposing of export controls on certain important raw materials.
RESourceEU will spell out how the Commission wants to diversify the EU’s supply of materials like lithium, copper and nickel, by brokering partnerships with countries like Australia, Kazakhstan, Uzbekistan and others.
There will also be an increased effort to scale up recycling capacity, so those materials that are already within the EU, embedded in products that are approaching the end of their shelf life, can be reused, dispensing with the need to source primary materials.
Much of this will build on the critical raw materials act, which sets a number of benchmarks. Those include making sure that 10% of consumption of certain strategic materials is from domestic extraction by 2030, 40% is from domestic processing and 25% is from recycling.
Those are lofty targets and there are doubts that they can be achieved in time, but it has sent a powerful signal to various industries in Europe that they need to change how they do business in order to survive long-term.
A number of other EU initiatives are also playing their part, including financial support for the battery industry, using satellites to find new raw material deposits and powerful state aid mechanisms that reward cross-border projects.
Another EU initiative, the Global Gateway, focuses on investments in developing countries, particularly in Africa. Some of those projects are linked to resource development and extraction, with a mind to supplying the EU with whatever materials are produced.
This has stoked concerns about a return to the colonialist tendencies of the past, where poor countries were essentially treated like a supermarket. The EU will have to tread carefully to avoid a potentially damaging dynamic from emerging.
