“The specter of using rare earths as an economic weapon makes clear that the current trade war between the U.S. and China is in fact one front in a larger tech war – a competition to see which country will dominate the 21st Century Technology Age,” says ARPN principal Dan McGroarty in a new piece for The Economic Standard.
Our Achilles’ Heel in this tech war, he says, is our over-reliance on foreign metals and minerals underpinning 21st Century technology (of which Rare Earths are only the tip of the proverbial iceberg) and China’s dominance across the supply chains for many of them.
While this is daunting, McGroarty argues that policy makers are beginning to realize the urgency of the situation and are taking steps to counter China’s jockeying for pole position. He points to a little-noticed dinner at this week’s G20 meeting in Osaka, Japan between newly-reelected Australian Prime Minister Scott Morrison and U.S. President Donald Trump.
“With the media focused on the meetings between the American president and his Chinese and Russian counterparts, the decision to start the summit with a U.S.-Australia session merits more attention. Both countries – joined by Canada and the U.K. — are part of a little-known forum called the NTIB, the National Technology Industrial Base, an entity created by U.S. law that treats the technological and industrial might of all four allies as a single entity for national security purposes.
With three-fourths of the NTIB — the U.S., Australia and Canada – among the world’s most resource-rich nations, the forum offers the perfect opportunity to work in concert to develop critical minerals. The table was set in early 2018, when then-Prime Minister Malcolm Turnbull and President Trump issued a joint declaration testifying to the primacy of tech metals [.] (…)
Since that declaration, both the U.S. and Australia have formulated Critical Minerals strategies, while the U.S. has issued a Defense Industrial Base supply chain report stating that ‘…China represents a significant and growing risk to the supply of materials deemed strategic and critical to U.S. national security.’ The U.S.-Australia G20 meeting comes just days after Canadian Prime Minister Justin Trudeau – Canada has been an NTIB member for more than 20 years — met with President Trump at the White House, and the two leaders ‘instructed officials to develop a joint action plan on critical minerals collaboration.’ We may be seeing the piece-parts of a larger U.S-Australia-Canada critical minerals strategy put in place.”
With this joining of forces at the governmental level being complemented by private sector collaboration as outlined by McGroarty, we may indeed be witnessing the beginning of a “tech war counter-offensive, leveraging the resource wealth of the U.S. and its leading allies to ensure adequate supplies of the materials that power the transformative technologies of the 21st Century.”
Here’s hoping this effort does not fizzle. As Benchmark Industrial Minerals managing director Simon Moores recently pointed out:
“There is no doubt that if the US acts now and invests wisely in partnerships, it can catch up, (…) [b]ut it really needs to act now.”