Highlights

• The EU remains critically dependent on China and Russia for rare earth processing and critical mineral supplies.
• European green energy ambitions are compromised by limited domestic refining capabilities and geopolitical tensions.
• Despite sanctions, the EU continues to import significant mineral resources from geopolitical adversaries, undermining its strategic independence.

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Dirk Kohnert, an associated expert at the GIGA Institute for African Affairs (opens in a new tab) in Hamburg, examines the precarious position of the European Union (EU) in sourcing rare earth elements (REEs) from Russia amid geopolitical and economic tensions. The paper argues that while the EU desperately needs rare earths for electric vehicles, wind turbines, and high-tech applications, it faces a harsh reality: China dominates global processing, and Russia, despite sanctions, remains a key supplier. The research challenges the EU's ability to achieve strategic autonomy in raw materials, questioning whether new policies, such as the European Critical Raw Materials Act (CRMA), can realistically reduce dependence on adversarial nations.

Overview

Kohnert, in the paper published in ECONSTOR, (opens in a new tab) employs a geopolitical and economic analysis of rare earth supply chains, examining trade data, policy initiatives, and market trends to highlight the EU’s vulnerabilities. The paper identifies three major bottlenecks of interest:

Bottlenecks	Summary
China’s Stranglehold on Processing	Despite Europe’s ambitious rhetoric, China refines 90% of the world’s rare earths, making Europe heavily dependent on Chinese supply chains. Even if the EU diversifies mining operations, it lacks the processing infrastructure to convert raw materials into usable components.
Russia’s Overlooked Role	The EU has quietly continued to import critical metals from Russia, including 41% of its palladium, 16% of its platinum, and significant shares of cobalt, lithium, and scandium. Despite political tensions, sanctions have largely spared Russian mining companies, exposing Europe’s hypocrisy in punishing Russian aggression while financing its mineral sector.
Europe’s Mining NIMBYism	While the EU has deposits of rare earths (notably in Sweden’s Kiruna mine), environmental opposition and regulatory hurdles stall domestic mining projects. Local protests in Spain, Portugal, and Serbia have blocked potential rare earth extraction, forcing the EU to rely on imports instead.

The CRMA sets ambitious targets—mining 10% of Europe’s needs, recycling 25%, and processing 40% by 2030—but Kohnert warns that Europe is years, if not decades, behind China and Russia in refining capabilities.

Interrogating Key Breakthroughs

The study unmasks the illusion of European self-sufficiency in critical minerals. Three key takeaways emerge:

• Europe’s Strategic Autonomy is a Mirage – Without domestic refining capacity, Europe will remain a raw material vassal to China and Russia, regardless of new mining ventures.
• Geopolitics and Green Energy Are Now Intertwined – The EU’s clean energy transition rests on the shoulders of geopolitical adversaries, making electric vehicle expansion and wind turbine production hostage to diplomatic tensions.
• Sanctions Are Half-Hearted and Self-Sabotaging – While the EU preaches energy independence, it still imports billions in Russian critical metals, ensuring Moscow’s war machine continues to be funded by European green energy ambitions.

Final Thoughts

While Kohnert’s research is thorough in its geopolitical critique, it lacks a concrete roadmap for breaking this cycle of dependence. The paper does not explore emerging technologies that could reduce rare earth reliance, such as alternative materials in electric motors or magnet recycling advancements.

The bottom line?

The author suggests Europe continues to play a dangerous game—it dreams of a future free from Russian energy but remains tethered to Russian minerals. It denounces China’s monopoly while ensuring its own helplessness in processing raw materials. Until the EU builds its own refining industry and overcomes its political paralysis on mining, its green energy revolution will be nothing more than a hostage negotiation with authoritarian states.