An alternative narrative on raw material access

 

The EU Green Deal has the overarching aim of making the European Union’s climate, energy, transport and taxation policies fit for reducing net greenhouse gas emissions by at least 55 percent by 2030 compared to 1990 levels, and climate-neutral by 2050. It aims to realize a clean and circular economy, including use that is more efficient and recycling of raw materials and innovative mining technologies.
 

At the same time, the global shift towards renewable energy, digitalization of our economies and societies and increased demand by defence and space industries, means that demand for raw materials is set to increase.
 

Global demand for the lithium used to manufacture batteries for mobility and energy storage is expected to increase of up to 89-fold by 2050.

Global demand for beryllium by aerospace and defence sectors, which already command between 10 and 20 percent of market share, is also projected to increase by 2030. EU demand for gallium, used to manufacture semi-conductors and on which China announced export restrictions in July 2023, is expected to grow 17-fold by 2050. EU demand for aerospace materials was already estimated at 28.2 percent of global demand in 2014, and competition for CRM procurement for aerospace and defence sectors is set to increase.
 

There are therefore inherent tensions at play for the EU: on one hand a need to secure increased EU access to critical raw materials (CRM) in order to enable the development of EU green industries, green energy supplies, digitalise economies and meet defense and aerospace demand; and on the other hand the need to transform the EU economy to respect planetary boundaries, which implies reducing consumption and demand of raw materials.
 

Additionally, rising awareness of the human rights and environmental cost of raw materials extraction increases the urgency for European policy makers and European businesses to clean up raw material supply chains.
 

Finally, the EU has identified raw materials as one of its main strategic dependencies. As expressed in the justification of the Critical Raw Materials Act (CRM Act): “the EU relies almost exclusively on imports for many critical raw materials. Suppliers of those imports are often highly concentrated in a small number of third countries, both at the extraction and processing stage. For example, the EU sources 97% of its magnesium in China. Heavy rare earth elements, used in permanent magnets, are exclusively refined in China.” Geopolitical considerations therefore underpin every aspect of EU policies on raw materials.