Germany: “From the Mine to the Mercedes” – Call for a New Raw Materials Policy

21. June 2022 | Market, Politics

War in Ukraine raises questions about secure supply options.

Germany’s raw materials policy is out of date and needs to be revised, according to a recent working paper published by the Federal Academy for Security Policy (BAKS), an interdepartmental training center of the Federal Republic of Germany in the field of security policy.

The author of the paper, Jakob Kullik, is a member of the “Young Security Policy Makers” working group at the BAKS and takes a hard line on Germany’s raw materials strategy in his opinion piece. He argues that this strategy was designed for a world in which the applicable international trade rules are largely respected by all states. In view of Germany’s heavy dependence on raw material imports from China, ranging from aluminum to rare earths, raw material security must become part of Germany’s new national security strategy in the future. Finally, the demand for critical raw materials will increase significantly due to the expansion of renewable energies. Added to this is electromobility, which is driving demand for permanent magnets made of rare earths in particular. Kullik also points to Russia’s attack on Ukraine, which has “raised questions about secure supply options, economic security of supply and political blackmail possibilities.” With regard to critical metals, Germany’s dependence is even significantly higher than for Russian gas, he said.

The working paper, previously reported on by Handelsblatt, ends with three recommendations for action. Alternative sources must be found, for example through raw material partnerships with third countries or Germany’s own extraction and processing of critical materials. In addition, responsibilities would have to be clarified and the decisive bodies would have to be equipped with sufficient competencies. Kullik also brings up the issue of stockpiling certain critical raw materials. Their purchase, stockpiling and sale could either be the responsibility of a new federal authority or – after an expansion of its powers – of the Federal Institute for Geosciences and Natural Resources (BGR).

Photo: iStock/Kosal Hor

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