Highlights
- The US is recognizing the strategic importance of critical minerals in foreign policy.
- China currently dominates 65-90% of global mineral processing.
- Successful minerals diplomacy requires:
- Long-term industrial planning
- Infrastructure development
- Significant government-backed investment to compete globally
- Potential strategies include:
- Developing geological surveys
- Creating infrastructure partnerships
- Pursuing innovative diplomatic approaches to secure mineral resources
In her guest essay in the New York Times, “A New Era of Minerals Diplomacy (opens in a new tab),” consultant Gracelin Baskaran argues that the United States has finally woken up to the importance of critical minerals in foreign policy—but remains unprepared to compete with China’s long-standing dominance in this arena. While the Biden administration largely ignored the issue, President Trump’s new strategy signals a dramatic shift, with bold proposals including the acquisition of Greenland, the potential annexation of Canada, and a minerals-for-support deal with Ukraine. However, Baskaran warns that these efforts will likely fail unless the U.S. commits to real investment, strategic infrastructure development, and long-term industrial planning—just as China has done for decades.
Ms. Baskaran points out what all the experts in this field already know: the U.S. has long neglected minerals diplomacy, unlike China. China has systematically built its dominance over rare earths through industrial planning and foreign policy despite having limited domestic supply.
Thanks to years of investment in supply chains, China now processes more than 65% of global lithium, cobalt, nickel, and copper and 90% of the world’s rare earths. On the other hand, the U.S. has lacked a coherent strategy and failed to leverage foreign policy to secure minerals—until now.
However, the opinion piece author reports that President Trump’s attempt at mineral policy will likely fail. Take the Ukraine approach, for example.
First, the U.S. has little modern geological data on Ukraine’s mineral reserves, relying on outdated Soviet-era surveys, which does not seem wise.
Second, mineral extraction is a decades-long process—on average, it takes 18 years to develop a mine from discovery to production.
Finally, even if a deal is signed, U.S. companies are unlikely to invest $500 million to $1 billion in developing these mines without assurances on ore quality, economic viability, and regulatory stability. As Rare Earth Exchanges has suggested, the Ukraine discussions represent more marketing than material sustenance. This means that Trump can boast that he won the American people a deal.
So what must the U.S. do then? Firstly, according to the New York Times opinion piece, the nation needs to invest in geological surveys and infrastructure to compete with China. The U.S. Geological Survey should be expanded to conduct new mapping of resource-rich nations and reduce exploration risks.
She points out that mining requires massive energy and infrastructure investments—for example, Ukraine’s mining potential is crippled by damaged power substations from missile attacks. Also, the U.S. should use development finance institutions, such as the International Development Finance Corporation, to rebuild key infrastructure and attract mining investments in Ukraine. Never mind the fact there is an ongoing war, but we’ll get to some of the problems below.
Rare Earth Exchanges has repeatedly called for a rare earth element and critical minerals industrial policy as the only way that the U.S. would be able to ultimately rebuild infrastructure for rare earth and other critical mineral mining, processing, and production. Rare Earth Exchanges concurs with the author that any successful strategy necessitates government-backed investment and risk mitigation.
This is because, unlike China, the U.S. has not aligned its financing and infrastructure projects with minerals extraction, and it is missing out on long-term resource control.
A key example is China’s 2007 agreement with the Democratic Republic of Congo, where China exchanged $6.5 billion in infrastructure investment for mining rights to cobalt and copper reserves worth an estimated $93 billion. The U.S. could pursue similar deals—such as Congo’s recent offer of mineral access in exchange for U.S. military assistance against Rwanda. Of course a lot of negative, nasty externalities are linked to such Chinese deals the author does not to emphasize.
The author avoids several significantly important points. Any moves by the U.S. to embrace industrial policy and critical mineral diplomacy bring geopolitical risks, including U.S. aggression.
While the essay critiques China’s dominance, it glosses over the potential diplomatic fallout from Trump’s aggressive mineral acquisition strategy (e.g., proposing to annex Canada). Literally, the traditional world order appears strained due to the U.S. pivot under Donald Trump. Canada is now in talks with Europe, and there is even talk of Canada joining the European Union, although the actuality of such an event is highly unlikely. Any competitive response to China will require a network of tightly collaborative and supportive countries (e.g., USA, Canada, Australia, Scandinavia, Germany, etc.).
The author does not address the significant environmental and social costs of mining, particularly in the context of U.S. mining expansion. In fact, the author does not mention the word environment or ecosystem once, which is surprising. China’s monopoly on critical minerals did not emerge by accident—it was built through aggressive state planning under its communist regime, allowing it to exploit both its own environment and that of other nations in pursuit of resource dominance. While it’s true that mining’s externalities were bound to occur somewhere, the sheer scale and severity of environmental degradation caused by China’s extraction and processing industries cannot be understated. The question remains: Is the U.S. willing to pay that price, or will it continue outsourcing the damage while scrambling for supply, perhaps hoping to innovate out of this challenge (recycling, non-rare earth magnets, etc.) over the next two decades?
And, while advocating for infrastructure investment, Baskaran largely ignores the environmental and human rights challenges associated with expanding global mining operations, particularly in conflict-prone areas like the DRC (opens in a new tab). And what about domestic mining? The author seems to assume the supremacy of foreign sources instead of discussing how the U.S. could expand domestic mining and processing capacity (e.g., investing in rare earth separation technologies or reopening closed mines).
Baskaran misses another pathway altogether that Rare Earth Exchanges has suggested to President Trump (if his folks read this news site). POTUS should fly over to Beijing and make a creative deal. One that he is uniquely positioned to do. Secure a decade’s worth of access at fair, stable prices while the U.S., in exchange, offers key access to the economy for investment and growth. In fact, the other day, Trump explained that the U.S. was open to business with China, which is a smart position. While Trump’s creative deal-making secures rare earth supply for a decade, true resilience can ensue as, in parallel, an industrial policy can be implemented over a decade-long period. An emphasis on technological transformation would be front and center (e.g., using non-rare earth magnets, recycling, and the like). That would help Trump transcend the current situation and, frankly, come out looking sort of heroic.
To conclude, in the New York Times, Baskaran delivers a compelling but incomplete argument: the U.S. must get serious about minerals diplomacy if it hopes to compete with China’s stranglehold on critical resources. But grand deals alone—like Trump’s Ukraine gambit—will achieve little unless backed by serious investment, risk mitigation, and infrastructure development. The author skirts some key, highly controversial issues (the dark stuff associated with critical mineral policy) but correctly directs the reader to better understand the crux of the problem.
Without a comprehensive long-term industrial strategy, short-term dealmaking—of the kind only Trump can orchestrate—and technological disruption as key pillars of what Rare Earth Exchanges calls industrial policy, America’s mineral ambitions risk becoming little more than hollow geopolitical posturing with no real impact on supply chain security.
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