NZZ Article: China Has Swiss Industry by The Throat

Against the backdrop of renewed negotiations between Donald Trump and Xi Jinping, ESM Managing Director Alessa Hool highlights, in a new NZZ article, the risks posed by Switzerland’s dependence on China for raw materials. Rare earths and the high-performance permanent magnets in which they are used are indispensable for Swiss industrial sectors such as medical technology, mechanical engineering, robotics and precision applications.

Swiss companies are concerned by the fact that China mines around 60 per cent of all rare earths and processes 90 per cent of them. This is because if China were to further tighten global export regulations in order to disrupt supplies to the US, Swiss companies would suffer collateral damage.

The discussion is not solely about the extraction of raw materials. Today, bottlenecks also exist in the downstream stages of the value chain: processing, metallisation and magnet production. Building alternative supply chains requires time, investment and international cooperation.

As a small, highly interconnected economy, Switzerland relies on open markets and resilient supply chains. To strengthen security of supply in the long term, a combination of diversification, recycling, innovation and international partnerships is needed. Read the article (in German)