Media: Germany, Advanced in Automotive Industry, Moving Slowly on Critical Minerals

Critical minerals are extremely important for the automotive industry. Whether it's batteries, fuel cells, or lighting equipment, modern automotive industries cannot function without rare earth elements. Without raw materials, production is impossible; without production, there can be no sales. And without sales, how can economic recovery be achieved? The reality is simple and cruel.

According to a commentary by Die Welt, under the backdrop of great power competition, countries like Germany, which lack raw materials, will face increasingly difficult situations.

"Countries without samarium, dysprosium, or yttrium will encounter problems. To ensure the normal operation of its automotive industry, the U.S. has had to make certain compromises with its rivals."

But how did things come to this point? On one hand, China itself possesses abundant rare earth resources; on the other hand, China foresaw the future early on and signed supply contracts with countries like Myanmar. Under the Trump administration, the U.S. government pressured Ukraine, which was suffering from Russian aggression, to obtain mining rights for its rare earth resources in exchange for military aid from the U.S. Of course, such actions are not without controversy in terms of morality.

But does striving for moral high ground help us at all? For an economy, ensuring access to raw material channels is crucial. As early as 2021, the EU signed raw material agreements with Ukraine. However, so far, the results have been minimal, partly due to the war and partly due to bureaucratic obstacles.

Europeans, especially Germans, cannot stand idly by while major powers divide up the world's raw material resources. Europe also needs to establish its own access channels. To achieve this goal, we must quickly sign long-term trade and supply agreements with South American, Asian, and African countries. Otherwise, the future of the industry will be unrelated to us, instead developing in China and the U.S., which will severely impact Europe's prosperity.

The Sino-American trade conflict has led to a cutoff of rare earth supplies, causing production delays and shutdowns. Concerns are growing in Germany's core industrial sectors. In a commentary, Handelsblatt wrote: "A significant portion of Germany's industrial value chain is heavily reliant on critical raw materials provided by very few suppliers. In high-tech, electric vehicles, wind energy, and defense products, rare earths play a crucial role. Once rare earth supplies are disrupted, production will immediately experience delays or even interruptions."

In many critical raw materials, Germany's import dependency exceeds 90%. If the dependency level is not reduced, supply security will inevitably be challenged in the long term. This issue is not new but has long been on the agenda, yet sufficient action has yet to be taken.

Multisourcing imports, establishing strategic reserves of critical raw materials, and expanding the recycling of raw materials through research and investment are necessary. At the same time, European joint procurement cooperation should be strengthened. In the long term, new raw material partnerships should be established with countries like Canada, Australia, and Chile. Efforts to promote domestic exploration and recycling projects should also be intensified.

Source: Associated Press

Original Article: https://www.toutiao.com/article/1834783484468224/

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