As the EU unveils the next phase of its critical minerals strategy, it faces a fundamental problem: Europe’s ambition to secure its supply of strategic resources risks deepening dependence rather than reducing it. The bloc is caught between the United States’ coercive industrial strategy and China’s dominance in processing, while largely ignoring the potential to curb demand.
Despite expanding mining, mobilising public finance, and easing some environmental and social safeguards, Europe’s approach focuses almost exclusively on supply security, leaving sectors such as defence, AI infrastructure, and automotive to compete for the same limited resources. Analysts argue that Europe’s most viable path to resilience lies in reducing structural demand rather than trying to replicate US or Chinese industrial models.
Critical Minerals as Geopolitical Assets
Lithium, cobalt, nickel, copper, and rare earths have become more than industrial inputs—they are geopolitical levers. The US has increased pressure on resource-rich states such as Ukraine, the Democratic Republic of Congo, and Zambia, convened a 50-country ministerial meeting, and deployed loans, guarantees, and public equity to secure supply. Meanwhile, China controls 70–96% of refined output in key minerals, demonstrating its market leverage through export restrictions. Resource-rich nations are also asserting control. Zimbabwe and Indonesia have imposed export restrictions on lithium and nickel, reflecting a global trend of resource nationalism.
Europe’s dilemma is clear: it cannot match the US fiscal firepower or China’s industrial scale and subsidies. Attempting to do so risks both inefficiency and exposure; the alternative—structural demand reduction—remains largely unexplored.
EU Strategy: Expanding Supply, Ignoring Demand
The Critical Raw Materials Act (CRMA) and RESourceEU Action Plan exemplify Europe’s supply-centric response. Brussels plans to accelerate extraction projects, de-risk investment using public funds, and streamline permitting. Circularity is included but primarily as a mechanism to extract minerals already embedded in products rather than to curb overall consumption.
A European Critical Raw Materials Centre would coordinate stockpiling, joint purchasing, and allocation to strategic sectors. Yet questions over governance, transparency, and equitable access remain unresolved, risking dominance by large corporations in defence, tech, and automotive industries.
Public investment further amplifies these concerns. With €3 billion earmarked for de-risking projects, Europe falls short compared to US investments exceeding $30 billion and Chinese Belt and Road equity allocations of $32.6 billion in 2025 alone. Critics warn that losses are socialised while profits are privatised, creating a system with limited accountability.
Demand Pressures Across Sectors
Critical minerals are now expected to supply energy transition, defence, AI, and automotive industries simultaneously, raising urgent questions about prioritisation. The International Energy Agency and UN Environment Programme highlight that measures to reduce mineral consumption—such as smaller batteries, alternative chemistries, and shared mobility—could cut demand by 18–50% in key sectors by 2030.
Yet Europe’s current strategy leaves these opportunities largely untapped. Recycling rates remain extremely low, and legislative measures for substitution are weak. Without demand-side reforms, Europe risks continuing exposure to volatile supply chains, escalating environmental impacts, and mounting geopolitical tensions.
Europe’s emerging mineral strategy prioritises securing more, not needing less. Analysts argue that true resilience would combine supply diversification with systemic demand reduction, improved resource efficiency, and sectoral reorganisation, particularly in mobility, defence, energy, and digital infrastructure. A supply-driven approach alone cannot guarantee security. To reduce vulnerability, Europe must confront the deeper question: how much mineral use is truly necessary, and for whom?
