Allianz - Critical Raw Materials, Aug 23

This report focuses on critical raw materials and their implications for Europe's future. Critical raw materials are metals and minerals that are essential for the production of high-tech products, such as electric vehicles, wind turbines, and smartphones. The report highlights that the green transition and digitalization are driving demand for these materials, but their concentration among a small number of countries could create geopolitical risks. The EU is highly dependent on imports of critical raw materials, which makes it vulnerable to supply disruptions and price volatility. The report notes that recent events, such as the semiconductor crisis and the pandemic-related supply difficulties, have highlighted the fragility of a global economy characterized by a concentration of resources that can suddenly become less accessible. To address these challenges, the EU has identified a list of critical raw materials and is taking steps to secure their supply, including recycling, substitution, and diversification of sources. The EU Critical Raw Materials Alliance brings together stakeholders from across the value chain to promote sustainable and responsible sourcing of critical raw materials. The EU Critical Raw Materials Action Plan sets out a comprehensive strategy to address the challenges of securing critical raw materials for Europe's transition to a low-carbon, digital economy. The report notes that the global market for critical raw materials is highly competitive, with China dominating production and processing. The EU's efforts to secure its supply of critical raw materials could have significant impacts on the global market. Finally, the report highlights that the formation of an Organization of Metal-Exporting Countries (OMEC) could create new geopolitical risks and challenges for the EU and other import-dependent countries.