“Critical Moves: Crowding in Capital to Finance Mineral Supply Chains” identifies how and why a new approach towards risk tolerance is necessary for public finance institutions to address resource challenge
Washington, D.C. — SAFE’s Center for Critical Minerals Strategy today released a new report, Critical Moves: Crowding in Capital to Finance Minerals Supply Chains, which identifies the challenges and opportunities faced by the G7, European Union, Australia, and South Korea as they deploy public financing institutions to support critical minerals investments. Export credit agencies, development finance institutions, national development banks, and government-backed funds across advanced economies are tasked with addressing strategic resource dependencies, but may lack the appropriate authorities or experience to finalize necessary investments. This report maps the specific pain points, and offers policy recommendations to empower these institutions.
“Governments have spent the last several years agreeing that critical minerals dependency is a strategic threat—they have allocated significant sums of money to address the problem. But deploying those funds into actual mines and processing facilities is another matter,” said Abigail Hunter, Executive Director of SAFE’s Center for Critical Minerals Strategy. “These public financing institutions exist, but the lack of alignment between what governments are asking them to do and what their mandates and risk tolerances actually allow is a far greater obstacle than anyone anticipated.”
China’s Head Start, and the Financing Gap Behind It
Between 2001 and 2023, Chinese state-directed entities deployed roughly $94 billion in financing to overseas critical minerals projects, helping Chinese firms secure long-term access to raw materials, as well as a dominant position in midstream processing and refining.
In July, the International Energy Agency’s Global Critical Minerals Outlook found that public finance commitments in advanced economies rose to approximately $65 billion in 2025. This was a four-fold increase compared to 2023. Despite this growth, “a considerable gap remains between commitments and actual disbursements,” the IEA found.
Building on its work through the SAFE-State Department MINVEST partnership and its Resources for Resources report, SAFE has identified that the role for public finance institutions goes beyond direct investments, but also to encourage private investment. Critical Moves examines the challenges to capital deployment and identifies opportunities for progress.
Three Barriers Are Slowing Public Finance Deployment
Critical Moves identifies three structural barriers standing between strategic ambition and financed projects:
- A mandate mismatch. Many export credit agencies and development finance institutions were built to promote exports, development, or commercial returns rather than resource extraction, and often lack clear authority for equity investment, early-stage support, or higher-risk jurisdictions.
- A gap between authority and practice. Even where institutions have the right tools—such as loans, guarantees, insurance, and offtake support—conservative internal processes and risk assessments often limit how much of that authority gets used, particularly for early-stage mining and novel processing technologies.
- A coordination gap. Project developers often cannot determine which institutions can support a given project or how they can co-finance it, while public institutions lack visibility into investable projects. Duplicative due diligence and disconnected funding channels mean projects can lose months or years to bureaucracy—and each allied country’s supply chain security is only as strong as its weakest-coordinated partner.
A Roadmap to Crowd In Capital
The report finds that allied governments hold an advantage China cannot easily replicate: the ability to mobilize private capital by using coordinated public financing to reduce risk rather than replace private investment outright. Realizing that advantage, the report argues, requires action in three areas.
Enabling international coordination
- Establish secure, government-to-government platforms for sharing project-level intelligence among allied partners.
- Harmonize due diligence and compliance processes across institutions, working toward mutual recognition of standards to cut transaction costs without lowering the bar.
- Give public finance institutions a direct seat in international critical minerals partnerships, including the G7 Critical Minerals Resilience and Production Alliance and the Forum on Resource and Geostrategic Engagement (FORGE), to drive co-financing and project pipeline development.
Improving whole-of-government approaches
- Coordinate financing across domestic and international agencies for projects spanning the full value chain, guided by bodies such as the U.S. National Security Council and its counterparts.
- Expand public finance institutions’ in-country presence and diplomatic engagement in resource-rich jurisdictions, where China maintains a denser commercial and diplomatic footprint.
Evolving mandates, conditions, and risk tolerances
- Develop more flexible offtake frameworks to address the circular dependency that stalls early project finance.
- Expand facilities for exploration and emerging processing technologies, where few institutions currently have the technical risk appetite to support a strategic project pipeline.
- Adjust financial risk tolerances to reflect the sector’s long timelines, price volatility, and capital intensity, rather than applying generic risk models.
- Formalize access to private sector expertise through embedded advisors, secondment programs, and public-private partnerships.
The report also argues that policy durability over decades will be key to success. Critical minerals projects often require 20 to 30 years of investment and operating certainty.
“The United States and its allies have the capital markets, the industrial base, and now the partnerships to out-compete China’s model—but only if we move with real speed and coordination,” Hunter said. “Critical Moves is meant to give governments, financial institutions, and project developers a practical foundation to move from policy commitment to financed projects, one deal at a time.”
