Business & Economy

EU proposes raw materials club to thwart Chinese monopoly

Davos, Switzerland, Jan 17 (EFE).- The European Union needs to create a club for critical raw materials to counteract China’s monopoly, European Commission president Ursula von der Leyen said on Tuesday.

“We can build a critical raw materials club working with like-minded partners – from the United States to Ukraine – to collectively strengthen supply chains and to diversify away from single suppliers,” von der Leyen said in a speech in Davos.

The commission president called for clean technology subsidies from the EU, Japan, the United Kingdom and the US that are “fair and mutually reinforcing” and to have a joint benefit “by creating economies of scale across the Atlantic or setting common standards.”

“Together, the EU and US alone are putting forward almost EUR 1 trillion to accelerate the clean energy economy. This has the potential to massively boost the path to climate neutrality,” von der Leyen said.

“The next decades will see the greatest industrial transformation of our times – maybe of any times. And those who develop and manufacture the technology that will be the foundation of tomorrow’s economy will have the greatest competitive edge,” she added.

Von der Leyen also stressed the need to “create a regulatory environment that allows us to scale up fast and to create conducive conditions for sectors crucial to reaching net zero.”

“This includes wind, heat pumps, solar, clean hydrogen, storage and others – for which demand is boosted by our NextGenerationEU and REPowerEU plans,” she said, citing the bloc’s 98% reliance on China for supplies of rare earth metals.

“China has been openly encouraging energy-intensive companies in Europe and elsewhere to relocate all or part of their production.

“They do so with the promise of cheap energy, low labor costs and a more lenient regulatory environment.

“At the same time, China heavily subsidies its industry and restricts access to its market for EU companies.”

Von der Leyen went on to say that the EU will still need to “work and trade” with China in the transition, stressing that the bloc will use all its “tools to deal with unfair practices, including the new Foreign Subsidies Regulation.”

“We will not hesitate to open investigations if we consider that our procurement or other markets are being distorted by such subsidies” because climate Change “already comes with a huge cost and we have no time to lose in the transition to a clean economy.”EFE


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