US and EU claim progress in reducing China reliance through ‘critical raw materials club’

White House meeting between Joe Biden and Ursula von der Leyen builds on plan to ‘strengthen supply chains and diversify away from single suppliers’

Talks also starting for limited trade pact on critical minerals allowing European electric vehicles to qualify for Inflation Reduction Act tax credit

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European Commission President Ursula von der Leyen speaks to journalists outside the White House after meeting with US President Joe Biden in Washington on Friday. Photo: AP

Published: 7:45am, 11 Mar 2023Updated: 11:23am, 11 Mar 2023

The US and EU made progress on Friday towards building the “critical raw materials club” that European Commission President Ursula von der Leyen hailed earlier this year to diversify supply chains in a clear reference to China.

“Today we agreed that we will work on critical raw materials that have been sourced or processed in the European Union and to give them access to the American market as if they were sourced in the American market,” said von der Leyen after a private meeting with US President Joe Biden in Washington focused on transatlantic economic issues.

The meeting at the White House came less than two months after von der Leyen spoke at the World Economic Forum in Davos about building “a critical raw materials club working with like-minded partners” to “collectively strengthen supply chains and to diversify away from single suppliers”.

At Davos in January, von der Leyen acknowledged Europe’s “98 per cent” dependence on China for critical minerals expected to play key roles in transitioning to clean energy. She also criticised Beijing for heavily subsidising its “energy-sensitive companies” and called for a “level playing field”.

Von der Leyen has previously noted Europe’s almost complete dependence on China for critical minerals that are expected to play key roles in transitioning to clean energy. Photo: dpa

China controls more than half the world’s supply of many critical minerals, such as nickel, lithium and cobalt. These are vital to both military supply chains and clean energy technologies, and the US and EU fear Beijing might withhold the minerals to undermine their economies and security.

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