【By Chen Sijia, Observer News】Recently, the U.S. government has been in constant contact with countries rich in mineral resources, trying to ensure the supply of critical minerals such as rare earths. This "competition for global supply" has caused anxiety in the EU. According to a report by the Financial Times on November 19, the EU plans to establish a mineral reserve center to prevent the U.S. from purchasing rare earth minerals globally.

After the Chinese and U.S. trade teams reached a consensus through consultations, China announced a one-year suspension of the new regulations on rare earth exports that were announced in October. However, the measures implemented in April have already had a significant impact on the EU industry, with multiple EU companies forced to shut down production lines and lay off staff.

Rare earths are key raw materials required for advanced weapons systems, aerospace components, wind power, new energy vehicles, robotics, and other industries. China holds a dominant position in the mining and refining of rare earths, accounting for about 90% of the global rare earth refining capacity.

Stéphane Séjourné, Executive Vice President of the European Commission responsible for industrial strategy and other matters, told the Financial Times that the EU has become a "collateral damage" in the Sino-U.S. trade dispute. The European Commission stated in October that it would quickly develop a plan to seek diversification of reserves of critical minerals such as rare earths, to reduce dependence on China.

Executive Vice President of the European Commission responsible for industrial strategy and other matters, Séjourné, Visual China

Séjourné said the EU will establish a "critical minerals center" to purchase critical minerals, coordinate procurement among European countries, ensure stockpiles, and promote economic security measures for EU companies in their supply chains. He said compared to a series of measures taken by the U.S., the EU has lagged behind in establishing such economic tools.

Séjourné told the Financial Times that the U.S. has started investing in its domestic mining companies and signed agreements with multiple governments on critical mineral supply. "The U.S. has a specialized commercial agency that is preemptively purchasing critical materials around the world. They often snatch these resources right under our noses," he said.

The U.S. government has recently been in constant contact with countries rich in mineral resources, seeking alternative sources of rare earths to replace China. Early this month, President Trump hosted an annual summit of the "C5+1" leaders of the U.S. with Kazakhstan, Uzbekistan, Kyrgyzstan, Tajikistan, and Turkmenistan in Washington.

According to the U.S. Department of State, this meeting facilitated an agreement between the U.S. and Uzbekistan, under which the U.S. will invest up to $400 million to "strengthen the U.S. companies' supply chain for critical minerals and rare earths."

Gao Zhi Kai, vice president of the Center for China's Globalization (CCG), described it as "the U.S. almost knocking on the door of every country in the world, as long as the U.S. believes there are rare earth reserves there. What the U.S. wants to do, as they say, is to get rid of being strangled by China."

To compete with the U.S. for the supply of rare earths and other critical minerals, Séjourné proposed that the EU sign cooperation agreements on mineral supplies with countries such as Brazil and South Africa. He will visit the two countries in the coming weeks.

Séjourné also suggested that the EU set price floors to ensure that European companies can obtain domestic stocks. He pointed out that mining companies and processors are often reluctant to invest in EU production because these companies fear that even if China tightens its rare earth export controls, customers still prefer to buy cheaper Chinese supplies.

All of Séjourné's plans must first be approved by the 27 members of the European Commission and may be modified. He estimates that the European Commission may propose priority recommendations to strengthen reserves and diversify supply.

The Financial Times noted that the EU had set domestic production goals for critical minerals in 2023, but lengthy and complicated approval procedures and opposition from environmental groups and others to new mining projects have led to repeated delays in related projects.

Victor van Hoorn, director of the European Clean Technology Association, believes Europe needs to act faster to strengthen the critical mineral supply chain. Van Hoorn said, "Europe needs to clearly identify its key raw material needs and weaknesses, then use various financial means to reduce risks."

However, Bloomberg previously pointed out that the EU has repeatedly expressed the desire for so-called "independent autonomy," but the reality is that the EU's economic security plans have not yet succeeded so far. An informed source said that the EU cannot act alone and take risks, and still needs to cooperate with countries such as Japan and Australia.

This article is an exclusive article by Observer News. Without permission, it shall not be reprinted.

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