Highlights

• Europe imports 98% of rare earth elements from China.
• This dependency poses significant geopolitical and economic risks in the green energy transition.
• Umbach recommends:
  • Expanding domestic mining.
  • Strengthening foreign partnerships.
  • De-risking supply chains to reduce foreign dependency.
• The EU must accelerate concrete actions to compete with China's vertically integrated mining operations.
• The goal is to secure critical mineral independence.

---

In The 7Ds for Sustainability–Decarbonisation Extended: Securing Europe’s Independence in Critical Raw Materials and Technological Components (opens in a new tab), Frank Umbach, PhD, a Senior Associate of the Centre for European Security Strategies (CESS)  presents an analysis of Europe’s overreliance on China for critical raw materials (CRMs) and the urgent need for a strategic shift.

Published by the Geopolitical Intelligence Service (opens in a new tab), the paper explores how China’s dominance in mining, refining, and processing of CRMs—particularly rare earth elements (REEs), lithium, cobalt, and nickel—threatens European energy security, defense industries, and technological sovereignty.

Key Hypothesis and Findings

Umbach argues that China’s control over CRMs is not just economic but geopolitical, mirroring Russia’s energy weaponization strategies. The EU, which imports 98% of its REEs from China, faces significant risks, particularly as global demand surges due to the green energy transition. The paper critiques Europe’s slow response to these vulnerabilities despite policies such as the EU Green Deal and the Critical Raw Materials Act (CRMA). While these initiatives promote mining, stockpiling, and supply chain diversification, the EU remains constrained by bureaucratic delays, environmental opposition, and China’s aggressive pricing strategies that undercut Western competition.

Umbach’s recommendations include:

1. Expanding domestic mining and refining to reduce reliance on foreign suppliers.
2. Strengthening foreign partnerships with resource-rich nations like Canada, Australia, and Africa.
3. De-risking European supply chains by prioritizing “friend-shoring” with allied nations and investing in strategic stockpiling.

Limitations and Bias

While the analysis effectively highlights Europe’s raw material vulnerabilities, it leans heavily toward geopolitical risk framing—potentially overstating China’s ability to fully “weaponize” mineral exports. The logistical and financial challenges of restarting European mining operations are acknowledged but not deeply explored. Additionally, the paper criticizes environmental opposition to mining without fully addressing legitimate concerns about sustainability and social impact.  Finally, the paper does not take into account the Trump presidency in America, his dropping of the Paris Agreement, and what impact this may have on markets.

Implications: A Race Against Time

Umbach’s study underscores a defining challenge for Europe: balancing climate goals, industrial competitiveness, and national security while competing against China’s entrenched supply chain dominance. The EU’s slow-moving bureaucracy and internal disagreements stand in stark contrast to China’s state-backed, vertically integrated mining operations. Without decisive action, European industries—especially defense, renewables, and electric vehicles—risk long-term strategic dependence.

The message is clear: Europe must move beyond policy declarations and accelerate concrete action. Whether through domestic mining, foreign partnerships, or technological innovation in recycling and substitution, failure to act could permanently disadvantage the EU in the global energy transition and critical mineral race.