As critical minerals become increasingly essential to national security, advanced industrial competitiveness, and energy resiliency, they have become the focus of new geopolitical rivalries. Trade policy has emerged as an area of bipartisan alignment as U.S. policymakers work to confront global supply chain, manufacturing, and competitiveness challenges.
This report from SAFE’s Center for Critical Minerals Strategy, titled “Trading Tensions: Navigating Policy Tools for A Diverse Critical Minerals Supply Chain,” examines trade policy solutions to influence the flow of critical minerals, with the goals of maintaining and building U.S. market presence, diversifying supply chains, and promoting higher global environmental and labor standards.
“Trading Tensions” offers policymakers a thorough overview of the geopolitical landscape and our current supply chain vulnerabilities, and the challenges we face as 70-93% of the world’s lithium, nickel, cobalt, and other essential minerals are processed in China.
In addition to an analysis of unilateral trade tools, joint trade tools, and trade preference programs, the report also contains a thorough discussion of the trade-offs that must be considered when working towards greater critical minerals security. The national strategy must consider competing imperatives between domestic vs. foreign production, decarbonization vs. supply chain security, and regulatory oversight vs. market competitiveness. To drive a holistic, strategic approach, proposals focus on:
- Enhancing the effectiveness of existing unilateral actions,
- Creating new trade agreements and enhancing multinational cooperation to level the global competitive field and promote a race to the top in standards,
- Bolstering domestic and allied production capacity to create alternative supply sources that complement trade policy.
