The UK should be less dependent on China for critical minerals, an influential think tank has concluded ahead of the government's strategy decision in the spring.
Inside a report On rare earth minerals, which are key components of high-tech products from mobile phones to missiles, Labor Together said ministers should reduce risks in supply chains and reduce dependence on China by establishing partnerships with other countries.
The report stated that China's dominance in critical mineral supply chains creates “fragility” and that the UK is at higher risk of being excluded after Brexit.
Amid rising trade tensions with the United States ahead of Donald Trump's inauguration, China banned shipments of antimony, gallium and germanium to the country earlier this month.
The UK government has said it will create a new strategy on critical minerals in the spring. Labor Together said this should be closely informed by the government's industrial strategy, which will also be announced in the spring, to determine which critical minerals and which stages of the supply chain the UK will rely most on in the future.
Critical minerals are essential for the green transition. Data shows that China mines about 70% of the world's rare earth metal ore, dominates its processing and refining, and uses it to produce 90% of the global supply of neodymium magnets, the most commonly used magnet in wind turbines.
The report also said it was important for China to “get involved where possible, for example on mining standards, rather than being treated as an enemy.” a paper In October, think tank the Royal United Services Institute said the UK should work with China to improve environmental and labor practices in mining and cooperate with Chinese companies operating in countries eligible for international aid.
Labor Together said the government should improve co-ordination of Whitehall-wide work on critical minerals, work more closely with the EU, promote responsible mining standards internationally and run a campaign to encourage investment.
The Conservative party published a critical mining strategy in 2022 that its foreign affairs committee said was “too broad and lacked a sense of urgency”. Then Tory committee chair Alicia Kearns said governments had been “asleep at the wheel” for three decades.
Labor Together described the Tory approach as “too slow, too general and with too little support”. Felix Cazalet, policy researcher at the think tank and author of the report, said: “The new government must be more alert than its predecessor to risks, including the concentration of production in countries such as China, and at the same time take a pragmatic and targeted approach to the crisis, leading to a new strategy.”
“This should focus on the key issues that matter to the UK and include working more closely with international partners such as the EU to increase responsible investment in resilient supply. The new strategy will help secure the supplies we need for the UK's growth, security and green ambitions.” It's an opportunity.”
Ruby Osman, China policy adviser at the Tony Blair Institute, said ministers should be prepared for disruption if critical mineral export restrictions targeting the US were extended to the UK.
“When it comes to China, our biggest problem has been timing. China has been building its remarkable market dominance for decades; “The UK announced its first critical mining strategy only in 2022,” Osman said.
“Diversification will rightly be at the heart of Labour's new strategy. But the UK's strategy also needs to be realistic; We cannot ignore how dominant China is at every step of these supply chains. “Even if the UK wanted to, it wouldn't be able to eliminate China completely, which means we will need thoughtful engagement.”
In 2010, China banned the export of rare earth elements to Japan following a dispute. The restriction lasted only two months but led Japan to diversify its supply chains and become less dependent on China.
