The European Union and Washington are closing in on an agreement to coordinate on producing and securing critical minerals, Bloomberg News reported on Friday.
Critical minerals like Lithium, Cobalt, Nickel, and rare earth elements are essential to electric vehicles, defence and electronic equipment, semiconductors, and green energy infrastructure.
China currently dominates approximately 80% of the global supply chain for processing and refining these minerals, nearly holding a virtual monopoly gives Beijing significant strategic leverage over its western rivals and of course others such as India.
The potential deal would include incentives such as minimum price guarantees that could favour non‑Chinese suppliers, the report said, citing an “action plan”.
The EU and U.S. would also cooperate on standards, investments and joint projects, along with increased coordination on any supply disruptions by countries like China, the report added.
The European Commission declined to comment on the report. The office of the U.S. Trade Representative did not immediately respond to Reuters’ requests for comment.
EU trade commissioner Maros Sefcovic said in March he had a “very positive” meeting with U.S. Trade Representative Jamieson Greer on the sidelines of a World Trade Organization ministerial meeting in Cameroon, where the two sides agreed to further advance work on critical minerals and also discussed tariffs.
The EU-U.S. deal would cover “critical minerals along the entire value chain and life-cycle management, including exploration, extraction, processing, refining, recycling and recovery,” Bloomberg reported, citing a non-binding memorandum of understanding.
The push comes as both Washington and Brussels scramble to reduce dependence on Chinese-dominated rare earth supply chains, following years of supply disruptions and growing strategic rivalry.
The move signals a broader shift among Western allies to align their industrial and trade policy — an urgency sharpened by China’s export restrictions on several critical minerals last year.
Important to note that Pax Silica launched by the US last December, to secure global supply chains for critical minerals, does not have China as a member.
