The Secretary of the Treasury urges more cooperation between the U.S. and Europe on critical minerals.
A week after the United States announced sweeping tariffs on Chinese imports, Secretary of the Treasury Janet Yellen said the U.S. is not trying to decouple from China but wants to diversify instead. Speaking at an event in Frankfurt, Germany, Yellen talked about U.S.-EU relations and highlighted the importance of the transatlantic partnership but emphasized that both the U.S. and Europe depend on the People’s Republic in fields like critical minerals as global supply chains are overconcentrated in China. To de-risk supply chains, Yellen advocated more collaboration under what she calls “friend-shoring,” or the formation of resilient networks through economic ties with like-minded nations.
In this regard, Yellen added that the proposed U.S.-EU Critical Minerals Agreement would be mutually beneficial. The two sides have been negotiating a critical minerals agreement since an announcement in 2023. Under such an agreement, critical minerals mined or processed in the EU would qualify for electric vehicle tax credits under the U.S. Inflation Reduction Act. This would make European carmakers more competitive while bolstering Western supply chains or critical minerals. However, despite announcements from both sides to intensify efforts, negotiations have not yet reached a conclusion.
European Commission President Ursula von der Leyen struck a similar note in her speeches regarding EU-China relations. For example, in March 2023, von der Leyen said she believes it “is neither viable – nor in Europe’s interest – to decouple from China.” She added that the People’s Republic is a main trading partner, but relations must be “rebalanced.”
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