The United States is significantly outpacing Europe in securing critical minerals outside China, raising concerns about potential European dependence on Chinese supplies for years to come. According to analysis by the French Institute of International Relations cited by The Wall Street Journal, Washington has committed approximately $46 billion to critical raw materials projects over the past five years through a combination of grants, loans, and tax incentives – roughly eight times the amount allocated by the European Union during the same period. This substantial funding disparity underscores the strategic importance both superpowers place on securing reliable supplies of essential minerals needed for clean energy transition, defence applications, and advanced manufacturing.
The aggressive US strategy extends beyond domestic investment, with Washington actively negotiating preferential access to mineral resources in key countries including the Democratic Republic of Congo and Ukraine, whilst simultaneously backing overseas projects through comprehensive financing programmes. This multi-faceted approach has already begun to disrupt European efforts to establish independent supply chains. London-based rare earth developer Pensana, which is developing the Longonjo project in Angola, has shifted its plans for a processing plant from Britain to the United States to pursue Export-Import Bank financing. Similarly, Brazilian rare earth producer Serra Verde, which operates a mine in Goiás state, secured US government-backed financing and subsequently agreed to sell its magnetic rare earth production under a long-term arrangement supported by Washington. These high-profile shifts demonstrate the competitive advantage the US financing ecosystem provides to critical minerals projects globally.
European industry leaders have expressed significant concerns about the implications of this trend, with some warning that the US could come to dominate emerging non-Chinese supply chains. Pensana founder Paul Atherley characterised the situation as “friendly fire” to other Western countries, highlighting the tension between allied nations competing for the same resources. In response, the European Union is mobilising its own resources and diplomatic efforts. The bloc has announced plans for a €3-billion ($3.4 billion) financing hub, strategic stockpiles, and strategic partnerships with countries including Canada, Argentina, Norway, and South Africa. By 2030, the EU aims to ensure that no single country supplies more than 65 per cent of its strategic raw material needs, representing a comprehensive approach to reducing supply chain vulnerability and building resilience in critical minerals sourcing.
