G7 Addresses China’s Dominance in Minerals for Technology
G7 leaders have committed to enhancing cooperation to reduce their reliance on China for critical minerals. They unveiled plans to coordinate stockpiling, boost recycling efforts, and establish a new platform with an expanded role for the International Energy Agency (IEA). This initiative comes as Western nations aim to secure supplies of essential minerals for defense, artificial intelligence, electric vehicles, and renewable energy technologies.
G7 plans critical minerals platform with IEA support
The leaders announced their intention to create “harmonised, interoperable mechanisms” for critical mineral supply chains, starting with pilot projects focused on lithium and nickel. They emphasized that these mechanisms would be designed to avoid undermining competitiveness or imposing excessive costs. The initiative is set to expand to include five additional minerals each year, particularly targeting rare earth elements.
Additionally, the G7 will establish a platform to coordinate policies, improve data sharing, and respond to supply disruptions. The IEA will support this initiative by monitoring markets and providing early warnings of market distortions.
Reducing China dominance remains a major challenge
Analysts have cautioned that achieving the diversification target will be challenging, especially for processed rare earths and permanent magnets, where China currently dominates about 90% of global production. Neha Mukherjee, research manager at Benchmark Mineral Intelligence, noted that while the G7 statement signals intent, the pace of diversification will depend on whether policy support translates into investment across the value chain.
Building alternative supply chains from mining to processing will require significant investment. The G7 stated that development finance institutions, export credit agencies, and private companies should collaborate to support new projects and infrastructure. Since the start of 2026, countries have announced 195 critical minerals projects, involving approximately €64 billion ($74 billion) in investment.
Stockpiling, recycling efforts gain momentum
The G7 has also pledged to increase domestic stockpiles of critical minerals across industrial and public sectors to guard against future supply shocks. Earlier this year, the United States launched its $12 billion critical minerals reserve, Project Vault, while the European Union has identified tungsten, rare earths, and gallium for its first joint stockpile.
The leaders further committed to expanding recycling capacity, aiming for G7 recycling systems to account for a significant share of annual critical mineral consumption by 2030. They discussed potential measures such as price-gap subsidies, joint procurement mechanisms, and quotas through multilateral trade agreements, although some allies expressed skepticism about proposals for price regulation.
G7 summit focuses on AI, Ukraine and Iran deal
The critical minerals agreement was one of several outcomes from the recent three-day G7 summit in France. Leaders also addressed topics including artificial intelligence, the ongoing Russia-Ukraine conflict, and a tentative agreement between the United States and Iran aimed at resolving tensions and reopening the Strait of Hormuz. The summit in Évian-les-Bains included leaders from Canada, France, Germany, Italy, Japan, the United Kingdom, and the United States, along with guest nations such as India, Brazil, Egypt, Kenya, South Korea, Qatar, Ukraine, and the United Arab Emirates.
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