Canada: Ready to Increase Cooperation on Critical Minerals with South Korea

by | 17. May 2023 - 11:16 | Economy

The two countries could form mutually beneficial trade relations.

Canadian Prime Minister Justin Trudeau addressed the South Korean parliament on Wednesday and said his country is “ready to strengthen our partnership with friends like Korea on everything from critical minerals to high-tech innovation to clean energy solutions,” according to Reuters. The speech comes during the first visit in nine years by a Canadian leader to the East Asian country. The two countries seek to boost their partnership amidst rising geopolitical tensions and supply chain risks. The partnership will also be central to a summit between Trudeau and South Korean President Yoon Suk Yeol later this Wednesday. According to Reuters, citing a South Korean government official, Yoon and Trudeau will sign an agreement on critical mineral supply chains, clean energy transition, and energy security cooperation.

Canada had only at the end of 2022 announced to expand Indo-Pacific trade relations as part of its new Indo-Pacific strategy. The North American country holds vast amounts of natural resources including 31 critical minerals and wants to establish itself as a world leader in the supply of these critical minerals. Currently, the industry is concentrated in a few countries. Specifically the rare earths sector is dominated by China, especially the processing and other downstream elements. Rising geopolitical tensions have driven other countries to build more resilient supply chains and decrease their dependency on China. Canada could present itself as a possible alternative source.

South Korea, on the other hand, is among the leaders of the global semiconductor industry and wants to further extend its position with investments of billions of dollars. These chips are components of almost all electronic devices and are thus in high demand. However, they require critical minerals. This double-sided demand could form the basis of symbiotic trade relations.

Photo: iStock/Oleksii Liskonih

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