While the EU, Japan and the United States have challenged China’s restrictive Rare Earths export policies before the World Trade Organization (WTO), German Chancellor Angela Merkel appears to have chosen a less confrontational route for Germany’s bilateral relationship with China.
During her state visit to China, Merkel offered to partner with Beijing in efforts to address environmental issues related to REE development – which China claims are the main reasons for its restrictive policies. Speaking at a conference in which both Chancellor Merkel, and Chinese Prime Minister Wen participated, President of the German Federation of Industries Ulrich Grillo reiterated that joining the WTO suit was not in Germany’s best interest. He did, however, voice concerns about distortions resulting from Chinese government control over the global REE market.
Raising the Rare Earths issue during the state visit is in line with Germany’s recent policy shift towards a more comprehensive mineral strategy and a more active role in the global race for resources. Having jumped into the REE pursuit at the beginning of the year with plans to develop a 38,000 tonnes deposit of Rare Earths in the East German state of Saxony, Germany has inked a cooperative REE development treaty with Mongolia and Kazakhstan, and is expected to partner with Russia to develop these precious resources as well.
Meanwhile, the recently formed “globally active profit-oriented raw materials corporation” called the “Alliance for Securing Raw Materials,” which enjoys the backing of the German federal government, is beginning to take concrete action, and may participate in a first project to explore and develop Rare Earths as early as this year.
With mineral supply issues affecting not only many of U.S. domestic manufacturers, but also our national security and economic wellbeing, one would think our policy makers in Washington, D.C. would place as much emphasis on addressing them. Thus far, Berlin is ahead of Washington in framing out a strategic policy concerning strategic metals.