Munich Security Conference Finds Four of Six EU Global South Projects Extraction-Led

Highlights

• Four of six EU strategic mineral projects in the Global South are extraction-led, with refining planned in Europe rather than host nations.
• China outcompetes Europe by bundling processing technology, infrastructure, credit and state-backed buyers—Europe offers designation but limited risk coverage.
• Songwe Hill and Zandkopsdrift link refining to Poland and France respectively; only Brazilian and Zambian projects place major processing in-country.
• EU Critical Raw Materials Act status signals visibility and financing guidance, not guaranteed funding, construction or operational status.
• Europe's deeper weakness is its inability to transfer rare-earth separation, graphite processing and cobalt refining technologies still dominated by China.

Europe’s critical-mineral diplomacy is colliding with industrial reality: resource-rich countries increasingly reject agreements that export material while leaving refining, technology and profits abroad. An August 2026 Munich Security Conference analysis finds that four of six European Union (EU) strategic projects examined in the Global South are extraction-led. It announces no new financing or technological breakthrough.

REEx Insight: Europe Cannot Buy Ore and Call It Partnership

The central argument is well supported. China can combine processing technology, infrastructure, policy-bank credit and state-backed buyers. Europe typically offers strategic designation, financing guidance and fragmented support—but insufficient protection against construction, commodity-price and offtake risks.

One qualification matters: the paper assesses six projects in the Global South, not the complete first-round portfolio of 13 EU-designated projects in third countries and overseas territories. It also acknowledges Europe’s deeper weakness: Brussels cannot easily transfer industrial technologies—particularly rare-earth separation, graphite processing and cobalt refining—that Chinese companies still dominate.

“Batteries Not Included”—Literally

The German introduction translates as:

“The EU needs new partners for critical raw materials in the Global South. Resource-rich countries expect the EU to help them move up the value chain, but so far the EU has not sufficiently met those expectations. Strategic projects under the EU Critical Raw Materials Act will show whether Europe can meet its partners’ demands while securing its own supply of raw and processed materials.” Songwe Hill would produce purified mixed rare-earth carbonate in Malawi, but separation is planned in Poland. Zandkopsdrift’s refining is tied to France. Only the Brazilian and Zambian projects studied place major refining or processing in the host country—and both have faced delays or financing pressure.

A Label Is Not a Capital Stack

Critical Raw Materials Act status provides visibility and financing assistance, not automatic funding. Investors must distinguish “strategic” from financed, permitted, constructed or operational.

Sources: Munich Security Analysis (opens in a new tab); European Commission project list.