Rare Earth Exchanges

China’s $57 Billion Power Play: Securing a Global Critical Minerals Monopoly

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Highlights

  • China has invested $57 billion through 26 state-backed financial institutions to control key mineral resources essential for energy transition.
  • Over 75% of China’s mineral investments guarantee ownership stakes in resource-rich countries like Congo, Peru, Indonesia, and Argentina.
  • Western nations struggle to coordinate financing and develop processing capabilities, risking permanent dependence on China’s mineral dominance.

As Rare Earth Exchanges continues to chronicle, China has quietly cemented its dominance over the global critical minerals supply chain, funneling an astonishing $57 billion through 26 state-backed financial institutions over two decades. A recent report by AidData (opens in a new tab) at William & Mary reveals how Beijing’s intricate web of financial mechanisms has allowed it to lock in long-term control over key resources essential for the energy transition—lithium, cobalt, nickel, copper, and rare earth elements.

China’s Rare Earth Complex

Unlike China’s Belt and Road Initiative (BRI), which primarily funds infrastructure, critical mineral financing operates through a broader network of state-owned lenders, including the Industrial and Commercial Bank of China, Bank of China, and Citic. The strategy relies on serial loans, joint ventures (JVs), and special purpose vehicles (SPVs), ensuring that Chinese entities control the extraction and processing of these vital resources. The result? Over 75% of China’s mineral investments guarantee ownership stakes, particularly in resource-rich nations like the Democratic Republic of Congo, Peru, Indonesia, and Argentina.

An Octopus with Global Tentacles

This aggressive acquisition strategy has left host countries in a precarious position. While Chinese financing helps them develop mines without assuming significant financial risk, it also limits their share of long-term profits and weakens national control over strategic resources. In two-thirds of cases, governments had little to no ownership in these projects, raising concerns about sovereignty and economic sustainability as Cecilia Jamasmie reported for Mining.com (opens in a new tab)

Free Market Free-for-All

China’s methodical approach stands in stark contrast to Western nations, which have struggled to coordinate financing, streamline permitting, and develop domestic processing capabilities. The report underscores an urgent reality: as global demand for rare earths and battery metals soars, China’s dominance in critical minerals threatens to leave the West permanently dependent.  As Rare Earth Exchanges has suggested, the real question now is whether the U.S. and its allies can counter China’s stranglehold—or if they are already too late. Rare Earth Exchanges has numerous articles on suggested strategies for the West.

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