Auditors say EU efforts to diversify imports of critical raw materials have failed so far

The European Court of Auditors stated on Monday that the EU's efforts in diversifying its imports of metals, minerals and other critical materials for?technology, defence and energy transition have "yet not produced tangible results".

The EU's Critical Raw Materials Act 2024 sets out a plan for boosting?local?production of 34 strategically important materials in order to reduce reliance on imported products from a small number of countries, primarily China, Turkey, and Chile.

List includes lithium, antimony and tungsten. Copper and rare earths are also needed for products like semiconductors, artillery shells, and wind turbines.

'OUTLOOK IS NOT PROMISING

The act established non-binding goals for 2030. By then, the EU would be able process 40% of their annual raw material needs, increase recycling capacity to 15%, and extract 10% of minerals.

The outlook for recycling is not good: seven of the 26 materials required for the energy shift have rates of between?1% to 5%. Ten of these materials are not recycled. This was revealed by the ECA in a recent report. It blamed a lack of incentives that were tailored to each material.

High energy costs can severely hamper competitiveness.

The EU's strategic raw material partnerships with third countries are yet to yield any results.

The EU signed 14 strategic partnership on raw materials in the last five year, with seven of those being in countries that have low governance scores. The ECA reported that imports from these countries dropped between 2020 and 2024, for "around half of all raw materials studied".

In December, the Commission announced a new plan called RESourceEU that would accelerate CRMA. However, many details are yet to be announced or implemented. Export restrictions on 'rare earth waste' are part of the plan, which is meant to counteract China's near-monopoly. It also includes a plan to invest 3 billion euros to accelerate some strategic material projects.

This week, EU ministers are meeting in Cyprus to discuss the decline of competitiveness for the EU compared with American and Chinese competitors.

A Trump administration official who is familiar with the plan revealed that the U.S. president Donald Trump will launch a strategic stockpile of critical minerals with $12 billion from the U.S. Export-Import Bank as seed money. Reporting by Julia Payne, Editing by Alex Richardson.

(source: Reuters)