{"id":6789,"date":"2026-04-23T16:14:44","date_gmt":"2026-04-23T14:14:44","guid":{"rendered":"https:\/\/esmfoundation.org\/?page_id=6789"},"modified":"2026-04-23T16:48:20","modified_gmt":"2026-04-23T14:48:20","slug":"geopolitics-and-policy","status":"publish","type":"page","link":"https:\/\/esmfoundation.org\/en\/geopolitics-and-policy\/","title":{"rendered":"Geopolitics and Policy"},"content":{"rendered":"\n
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1939<\/div>\n
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US Strategic and Critical Materials Stock Piling Act<\/a><\/h3>\n

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1940<\/div>\n
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US Licensing requirement for strategic raw materials <\/a><\/h3>\n

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1949<\/div>\n
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Discovery of the Mountain Pass deposit of rare earth metals in the USA<\/h3>\n

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1952<\/div>\n
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Foundation of the Swiss National Science Foundation<\/h3>\n

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1975<\/div>\n
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Communication \u201cThe Community’s Supplies of Raw Materials\u201d, EEC<\/a><\/h3>\n

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2004<\/div>\n
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Foundation of the Japan Organization for Metals and Energy Security (JOGMEC)<\/a><\/h3>\n

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2008<\/div>\n
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US National Research Council: Minerals, Critical Minerals, and the US Economy <\/a>

EU Raw Materials Initiative<\/a><\/h3>\n

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2009<\/div>\n
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Korean list of critical raw materials<\/a><\/h3>\n

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2010<\/div>\n
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China: Export restrictions on rare earth metals

Foundation of DERA, Germany<\/a><\/h3>\n

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2011<\/div>\n
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\u201cCritical Metals Strategy\u201d by the US Department of Energy<\/a>

JOGMEC investment in the Japan Australia Rare Earths B.V., Japan <\/a>

First EU list of Critical Raw Materials <\/a><\/h3>\n

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2014<\/div>\n
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Second EU list of Critical Raw Materials<\/a><\/h3>\n

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2016<\/div>\n
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Foundation of EIT RawMaterials<\/a><\/h3>\n

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2017<\/div>\n
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US Executive Order 13817 on a \u201cFederal Strategy To Ensure Secure and Reliable Supplies of Critical Minerals\u201d<\/a>

Third EU list of Critical Raw Materials<\/a><\/h3>\n

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2019<\/div>\n
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US Executive Order 13817 on a \u201cFederal Strategy To Ensure Secure and Reliable Supplies of Critical Minerals\u201d<\/h3>\n

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2019<\/div>\n
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EU Critical Raw Materials Act<\/a><\/h3>

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<\/a>The New Geopolitical Landscape<\/h4>\n\n\n\n

As demand rises and supply remains concentrated, managing critical and strategic raw materials (CSRMs) has become a defining geopolitical issue. Across major economies, CSRM strategies face a shared tension: governments want secure and sustainable supply chains, but mining and processing projects are capital-intensive, slow, politically sensitive, and constrained by infrastructure and permitting bottlenecks. Countries worldwide are therefore reshaping industrial policy, trade relations, and investment strategies to secure reliable access to essential inputs for clean energy, digital infrastructure, and defence.<\/p>\n\n\n

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Figure 5: Europe is the only continent where mining has declined in the 21st century – despite globally rising demand. In Asia and Oceania, mining has almost\/more than doubled between 2000 and 2017 [Source: Statista<\/a>].<\/em><\/p>\n\n\n\n

The Dominant Role of China<\/h4>\n\n\n\n
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China frequently appears as a central risk factor for CSRM supply because of its dominant position in extraction, processing, and further manufacturing across many raw materials. This dominance emerged from decades of investment in mining and processing capacity, low production costs (sometimes due to laxer environmental and social regulation), rapid political decision-making, and strategic export policies. Most industrialised countries, by contrast, focused in the last decades on high-value downstream segments, relied on cheap imports for their manufacturing inputs. Especially in Europe, primary production eroded \u2013 creating structural dependencies. <\/p>\n\n\n\n

China remains the pivotal actor in global CSRM supply chains. Its dominance is not the result of geology alone, but of decades of strategic state-backed investment in mining, refining, and midstream processing \u2013 areas many industrialised economies abandoned in favour of higher-margin segments. Combined with lower production costs, rapid regulatory decision-making, and targeted industrial policy, China now controls a decisive share of global processing for rare earths, graphite, magnesium, as well as component manufacturing such as battery materials, legacy chips, or permanent magnets. This position gives China significant leverage over international supply chains. Recent export controls on gallium, germanium, graphite, and rare earths illustrate how quickly regulatory decisions in Beijing can reshape global price dynamics, project timelines, and national risk assessments. China\u2019s expanding overseas mining presence \u2013 particularly through Africa, Latin America, and Belt and Road investments \u2013 further extends its strategic reach. As a result, every major economy now treats diversification from Chinese-controlled midstream segments as a core strategic priority, even while remaining structurally dependent on the country\u2019s unmatched processing capacities.<\/p>\n<\/div>\n<\/div>\n\n\n\n

<\/a>Geopolitical Leverage Through Concentration<\/h4>\n\n\n\n

In today\u2019s fragmented market environment, where export restrictions, tariffs, and trade interventions often go unsanctioned, China\u2019s concentration across key segments gives it significant leverage over global supply chains. While China clearly is the leader in most critical raw materials extraction and processing, some other countries also play important roles in individual materials due to unique geology, specialised capabilities, or historic industry development. Diversifying away from single-country dependencies has become a strategic priority for governments worldwide.<\/p>\n\n\n

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Figure 3: Countries accounting for the largest share of global CSRM production [Source: European Commission<\/a>]. Note that this map does only look at either the extraction or processing stage and that the nationality of producing companies is not factored in.<\/em><\/p>\n\n\n\n

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Global Strategic Shifts<\/h4>\n\n\n\n

Here are some examples of different ways countries navigate their critical raw materials policies. The International Energy Agency keeps track<\/a> of more countries’ policies.<\/p>\n\n\n\n

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United States: Full-Spectrum Strategic Rebuild<\/h5>\n\n\n\n

The United States currently approaches critical raw materials through a combined economic-security and defence lens. Its vulnerabilities stem less from geological scarcity than from decades of offshoring mining, processing, and midstream manufacturing, which have left many supply chains heavily dependent on foreign refining, particularly in China. To address these gaps, U.S. strategy increasingly targets entire value chains, aiming to expand domestic and allied capabilities in extraction, refining, material transformation, and component manufacturing for batteries, permanent magnets, semiconductors, and power electronics. Policy signals, however, although often aggressive, remain volatile. President Trump\u2019s pauses or reversals of clean-energy incentives have created uncertainty for investors, complicating long-term planning. At the same time, targeted federal and state-level funding \u2013 including grants, loans, and tax incentives \u2013 continues to support new mining, recycling, and midstream processing capacities. The Defense Production Act (DPA)<\/a> remains a central tool for accelerating strategic projects and strengthening domestic production, while U.S. agencies are simultaneously trying to expand international partnerships under U.S. leadership to diversify supply away from China.<\/p>\n<\/div>\n\n\n\n

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United Kingdom: Managing High Import Dependence<\/h5>\n\n\n\n

Other advanced economies face very different but equally structural vulnerabilities. The United Kingdom is one of the most import-dependent high-income economies for critical raw materials; Not being a member of the EU anymore, it is acutely exposed to geopolitical shocks and trade disruptions. Decades of industrial restructuring have eroded domestic extraction and processing, while most imports enter the UK in processed form, embedded within components, electronics, and advanced materials. This makes supply-chain visibility and traceability a persistent challenge. UK strategy therefore centres on diversification, circularity, and intelligence-building rather than large-scale domestic mining. Current efforts prioritise strengthening recycling and remanufacturing capabilities, improving data and early-warning systems through the Critical Minerals Intelligence Centre (CMIC)<\/a>, and expanding partnerships with trusted suppliers. Given limited geological potential, the UK focuses on niche capacities \u2013 such as specialised magnet recycling or tungsten processing \u2013 where small-scale, high-value production can strengthen resilience without requiring large upstream industries.<\/p>\n<\/div>\n\n\n\n

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Japan: Economic Security Through Long-Term Partnerships<\/h5>\n\n\n\n

Japan integrates critical raw materials deeply into its broader economic security doctrine, shaped by its acute import dependence and the lasting impact of the 2010 rare-earth crisis. The country\u2019s resilience strategy combines diversified overseas investments, national stockpiling, and close state-industry coordination through institutions such as the Japan Organization for Metals and Energy Security (JOGMEC), which actively supports exploration, project financing, joint purchasing, and midstream processing capacity. Japan\u2019s approach emphasises long-term relationships with partner countries \u2013 such as Australia \u2013, often backed by public guarantees and co-investment structures designed to reduce private-sector risk. Recent policies (METI: Japan\u2019s new international resource strategy to secure rare metals (2020).<\/a>, JOGMEG Critical Minerals Subsidy Program (2023, in Japanese)<\/a>, METI Policy on initiatives for ensuring stable supply of critical minerals (2022, in Japanese)<\/a>) place renewed focus on securing stable supplies for GX (Green Transformation) and DX (Digital Transformation) technologies, including batteries, motors, semiconductors, and hydrogen systems. Alongside upstream investments, Japan is expanding efforts in recycling, substitution R&D, and traceability initiatives to improve supply-chain transparency. The result is a system in which the government plays a hands-on role in steering industrial strategy, ensuring that Japan\u2019s globally competitive manufacturing sectors retain access to the materials they rely on.<\/p>\n<\/div>\n\n\n\n

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<\/a>The EU\u2019s Response<\/h4>\n\n\n\n
<\/a>Europe\u2019s Structural Dependence on Imports<\/h5>\n\n\n\n

The EU is one of the world\u2019s most import-dependent regions for critical raw materials, particularly for those processed in China. Having invested in segments that promised higher value creation and with increasing globalization and cheap imports, the mining sector has steadily declined in the last decades.<\/p>\n\n\n\n

<\/a>The Critical Raw Materials Act: Strategic Autonomy in Practice<\/h5>\n\n\n\n

The EU focuses strongly on reducing import dependence and building strategic autonomy through the Critical Raw Materials Act (CRMA)<\/a>, in force since 2024. Benchmarks to be reached by 2030 aim to expand extraction, processing, recycling, and diversification for raw materials deemed strategic for the European Union. Yet the EU faces slow permitting, complex ESG expectations, and competition for investments from regions with faster project development and large subsidies. Europe\u2019s strategy relies heavily on international partnerships to secure sustainable supplies while developing midstream capacity at home.<\/p>\n\n\n\n

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Figure 6: Benchmarks for EU strategic raw materials, to be reached by 2030 [Source: European Commission<\/a>].<\/em><\/p>\n\n\n\n

<\/a>Strategic Projects: Fast-Track Tools for Key Value Chains<\/h5>\n\n\n\n

Under the CRMA, the EU designates certain mining, processing, recycling, and substitution projects as strategic projects<\/a>. These projects must deliver a meaningful contribution to European supply, meet strict ESG criteria, and qualify under accelerated permitting rules. In return, they benefit from accelerated permitting timelines, coordinated access to financing, and recognition as priority infrastructure, helping reduce investment risk and shorten time-to-market \u2013 a critical factor in CSRM value chains where project development typically spans more than a decade. However, so far there is no direct funding for strategic projects available.<\/p>\n\n\n\n

<\/a>ReSourceEU: Strengthening EU Governance and Preparedness<\/h5>\n\n\n\n

To operationalise CRMA implementation, the European Commission adopted the RESourceEU Action Plan<\/a> in early 2025. This initiative shall strengthen CRMA governance and monitoring capacities through measures such as:<\/p>\n\n\n\n