Europe's Position on Raw Materials of the Future (cepInput)

"The chances of survival of the European social and economic model are partly determined on the international commodity markets," says cep economist André Wolf, who wrote the cepInput. The so-called critical raw materials are the prerequisite for the transformation of industries towards decarbonisation and automation. Metals such as lithium, cobalt, titanium and rare earth metals are indispensable for various future technologies: for regenerative power generation in wind power and photovoltaic plants, for the mobility revolution in batteries and fuel cells, for digital networking in displays and fibre optic cables and for automated control in microchips.

The problem lies in the fact that the resources are predominantly extracted outside Europe’s sphere of influence. Many countries of origin do not share European environmental and social standards – and the supply situation is often concentrated in only one country or a few countries: cobalt from the Congo, platinum metals from South Africa or vanadium and rare earth metals from China.

Wolf analyses three strategies that could be followed by the European Union in the procurement of raw materials. An EU-internal raw materials extraction strategy has so far played a subordinate role. In Wolf's view, state support for domestic extraction is not the right way, especially for economic reasons. In the short term, the EU would benefit more from strategic partnerships, such as those that already exist with Canada and Ukraine. These could be formed with more countries that share similar sustainability standards as the EU. According to Wolf, however, in the long term there is no way around expanding recycling capacities. Under the keyword "urban mining", the raw materials already present in appliances must be recycled. This requires proper disposal, an efficient collection and sorting system and increased capital input. Overall, collection and recycling rates in the EU need to be significantly increased.

The EU's 2020 Action Plan for Critical Raw Materials aims to strengthen domestic value creation, diversify supply chains and ensure security of supply. "The European Commission has recognised the strategic importance of these issues in principle, as the Action Plan and the recent announcement of legislation on critical raw materials make clear. However, concrete instruments and clear prioritisation are still lacking. The cep argues for a raw materials strategy that is essentially based on strategic partnerships with third countries in the short term and on the strengthening of internal procurement through circular resource use in the longer term," Wolf sums up.