Competition for critical raw materials has become the latest geopolitical battleground, and the EU must take a more proactive approach to secure its share of global supply, essential for fulfilling Green Deal commitments.
Lithium, cobalt, graphite and other materials are necessary for the batteries, solar panels and wind turbines that will power our sustainable future. However, with tensions rising between global powers, a stable supply of these minerals is not guaranteed.
Take lithium, for example. It is essential for battery production, which will underpin the shift to electric vehicles and the greening of electricity grids. Europe’s limited lithium resources make self-sufficiency impossible, and recycling won’t satisfy demand until at least the 2030s. This makes partnerships with lithium-rich, like-minded countries like Chile, Australia and Argentina indispensable.
Although European companies are investing in these regions, more comprehensive EU involvement is required. China, in particular, is advancing rapidly in this area, and Europe will fall behind if it does not take a more proactive approach.
The Critical Raw Materials Act (CRMA) provides a framework for how the EU can access these resources. It outlines three key pillars: strengthening the EU’s value chain, improving recycling, and fostering partnerships with outside countries. However, it lacks the necessary financial backing and concrete implementation plans, especially regarding external partnerships.
Financing mechanisms, such as the European Sovereignty Fund proposed by European Commission President Ursula von der Leyen, will be essential for deepening the EU’s engagement in projects to supply these resources. The CRMA allows projects in outside countries to be designated as “strategic” if they have a direct link to the EU through future purchase agreements, but it lacks the dedicated funding to support such projects.
A fund dedicated to critical materials – whatever form it takes – would ensure that strategic partnerships are backed by meaningful financial support and not just regulatory declarations.
To secure its supply chains, the EU must offer producing countries more than just free trade agreements. A more comprehensive package could include support for added value creation, such as refining and cathode production, within these countries. Infrastructure development, skills training, and technology transfer should be part of this approach, facilitated by the Global Gateway initiative.
However, this also requires new funding streams and a more transparent long-term strategy to be effective.
The EU should also ensure equal market access for materials from partner countries. These materials should not face disadvantages compared to EU-produced resources, whether through tax incentives or minimum local content requirements. This approach would strengthen long-term partnerships and boost local economies in key resource-producing regions.
The EU must shift from legislative frameworks to real-world action. Achieving its climate goals depends on strategic, well-funded partnerships with like-minded, resource-rich countries. While the EU has set ambitious targets for its green transition, these ambitions will remain out of reach without concrete investments and a cohesive strategy for securing critical raw materials.