How will Europe’s and China’s Relation Change?

Baden-Wurttemberg’s state environment minister Franz Untersteller (Greens) called in a recent press conference for his state to become more independent of imports of raw materials from China. This includes, in particular, rare earths. The sluggish supply of medicines and protective masks is a clear warning for Mr Untersteller. After all, China still has a quasi-monopoly on rare earths. In the event of a crisis or a possible trade war, China could stop these supplies, and Europe would soon be on dry land. And with it the car manufacturers in the southwest of Germany.

A study by the German Commodities Agency (DERA), published at the beginning of April, shows how right Mr Untresteller is with his claim. China is the world’s largest producer of 17 of the 27 critical raw materials listed by the EU. In recent years, however, China has increasingly consumed its raw materials itself – and is pushing mining projects elsewhere, for example in Africa. The People’s Republic is no longer content with being a supplier of raw materials to the West, but wants to offer more and more higher-quality products on the world market. This development offers great potential for the sale of technology and machinery for the European – and especially the German – industry. At the same time, China is increasingly becoming a competitor – for rare earths, but also for the sale of higher-quality products.

Sources: stimme.de (german), deutsche-rohstoffagentur.de (german)