Critical Material Access Tension

Critical materials are essential for producing technologies such as wind turbines, solar panels, electric vehicle (EV) batteries, and microchips. However, significant dependencies on China, one of the largest suppliers of refined critical materials in the world, have prompted efforts to source such materials locally or from political allies.

For example, despite protests from residents and environmentalists, in July 2024, the European Union signed a cooperation pact securing access to Serbia's lithium reserves (Europe's largest source), thereby ensuring access to EV battery material for EU automakers. The geopolitical back-and-forth appears to be escalating — in December 2024, China banned exports of certain critical minerals to the U.S. in response to a U.S. ban on exporting microchips to China.

In early 2025, in retaliation for President Trump's tariff increases, China suspended global exports of various critical minerals and magnets, posing a serious threat to supply chains for automakers, aerospace firms, semiconductor companies, and military contractors all over the world. As a result, a March 2025 executive order called for boosting domestic production of critical minerals and strengthening U.S. supply chains for these essential resources. Ultimately, global access to critical materials — and the resulting fluctuations in cost and technology availability — will have major local and regional impacts.