Ambitious EU key materials act to ease supply strains

Significance

The bill focuses on sourcing, extraction, processing and recycling of materials necessary for the production of solar panels, electric vehicles, heat pumps, wind farms, semiconductors, pharmaceuticals and ammunition. The EU has defined a list of 14 strategic materials and a broader list of 33 critical materials.

Impacts

• Faced with an influx of cheaper Chinese EVs, European carmakers are lobbying to accelerate ‘anti-carbon’ measures to keep competition out.
• The 2021 EU-Ukraine Strategic Agreement on sourcing raw materials is not enforceable due to ongoing destruction in Eastern Ukraine.
• There is no deal regarding the rules binding companies exporting minerals to the EU to meet environmental standards and labour rights.
• The directive will erect barriers between the European market and Chinese battery makers whose production lines rely on coal power.
• Some indigenous groups in the Nordic nations have criticised the new policies as not adequately protecting the interests of the Sami people.