According to the “Financial Times”, this decision came in response to European companies being harmed by Chinese restrictions on the export of rare earth minerals, which led to the shutdown of production lines and the dismissal of workers.
China controls the majority of global refining capacity for these minerals, putting Europe in a weak position. For this reason, the European Commission announced that it will accelerate its plans to diversify stockpiles and secure supplies of minerals such as lithium, copper and rare earths, as well as seeking new partnerships with countries such as Brazil and South Africa.
“Stéphane Séjourné”, responsible for industrial strategy, stated that the new body will be responsible for purchasing the inventory and coordinating its distribution within the Union countries, and pointed out that the United States had preceded Europe in building supply networks and investments in the mining field.
European mining projects face challenges due to bureaucracy and concerns about cheaper Chinese competition, prompting Brussels to consider additional support mechanisms and price guarantees that incentivize domestic production. The plan also includes funding innovation to develop technologies that reduce dependence on rare minerals.
(“Financial Times”)
