The European Union has announced its backing for 46 strategic projects aimed at bolstering the supply of critical raw materials, a move designed to reduce the bloc’s dependence on China amidst growing concerns over potential trade disruptions. European Commission Industry Commissioner Stéphane Séjourné emphasized the need for the EU to prepare for possible supply chain interruptions in the coming months.
The projects focus on strengthening European supply chains for materials essential to industries such as automotive, defense, and renewable energy. Key initiatives include facilities for lithium, gallium, and rare earth elements, with an estimated total investment requirement of €21 billion. These projects have been granted strategic status under the EU’s Critical Raw Materials Act, which aims to curtail reliance on foreign suppliers and enhance the EU’s ability to secure essential resources by 2030.
Some projects are already underway. A rare earth processing plant near Pau in southwestern France is expected to produce dysprosium and terbium, materials used in magnets for electric vehicles and offshore wind turbines. In Greece, a gallium plant is operational, while Finland’s Keliber lithium extraction and processing project has commenced operations with the help of €150 million in support from the European Investment Bank.
In tandem with these domestic efforts, the EU is also engaging in diplomatic measures to ease trade tensions with China. Trade Commissioner Maroš Šefčovič has been in discussions in Beijing as European officials work to address the trade imbalance and concerns over Chinese imports.
The EU has set ambitious targets for 2030, aiming to extract at least 10% of its annual consumption of strategic raw materials domestically, process 40% within the EU, and recycle 25%. However, industry representatives have expressed skepticism about whether the current support measures will be sufficient to meet these objectives.
While achieving strategic status does not automatically entail direct funding, it can streamline permitting processes and assist projects in securing investment. Stéphane Séjourné noted that EU member states have unlocked €1 billion for six projects, while the European Investment Bank has provided an additional €660 million in support for eight initiatives.
The EU hopes these new projects will help establish a more robust domestic raw materials industry, enhance economic security, and mitigate risks associated with disruptions to international supply chains.