G7 Unveils Strategic Plan to Break China’s Critical Minerals Monopoly
G7 leaders have launched a massive coordinated effort to decouple their supply chains from Chinese dominance in the critical minerals sector. The new initiative aims to secure the raw materials essential for the future of artificial intelligence, electric vehicles, and renewable energy technologies.
Setting Ambitious Diversification Targets
In a significant move to enhance economic security, G7 leaders have outlined specific targets to reduce reliance on any single supplier outside the group. The group aims to bring the dependence on external suppliers for rare earth elements and permanent magnets down to below 60% by 2030. The long-term vision is even more aggressive, with the goal of reducing this dependency to 50% "as soon as possible."
This push follows recent disruptions caused by China’s export restrictions on permanent magnets, which highlighted the strategic vulnerability of Western industries. By setting these benchmarks, the G7 is signaling a transition from reactive measures to a structured, long-term reduction of geopolitical risk in the mineral supply chain.
The IEA-Backed Platform and Pilot Projects
To operationalize these goals, the G7 will establish a new platform to coordinate policies, improve data sharing, and respond to sudden supply shocks. The International Energy Agency (IEA) will play a pivotal role in this framework, providing market monitoring and issuing "early warnings" of potential market distortions.
The group will begin its implementation with two pilot minerals: lithium and nickel. These pilots are designed to create "harmonised, interoperable mechanisms" without imposing excessive cost burdens on industries. According to reports, the initiative plans to expand by adding five additional minerals every year, with a heavy emphasis on rare earth elements.
Stockpiling, Recycling, and the Investment Gap
Recognizing that mining alone is not a silver bullet, the G7 is focusing on two other critical pillars: stockpiling and recycling.
- Stockpiling: The US has already initiated "Project Vault," a $12 billion critical minerals reserve, while the EU is shortlisting tungsten, rare earths, and gallium for its first joint stockpile.
- Recycling: Leaders pledged to expand recycling capacity so that circular economies account for a "significant share" of annual mineral consumption by 2030.
However, experts warn of a massive execution gap. While €64 billion ($74 billion) has been committed to 195 critical mineral projects since the start of 2026, China still controls approximately 90% of global production for processed rare earths and permanent magnets. Bridging this gap will require massive investment across the entire value chain—from raw extraction to midstream processing and downstream manufacturing.
Key Takeaways
- Strict Targets: The G7 aims to reduce reliance on single-source suppliers for critical minerals to below 60% by 2030 and 50% long-term.
- Strategic Oversight: A new coordination platform supported by the IEA will monitor markets, starting with lithium and nickel pilot projects.
- Multi-Pronged Defense: The strategy integrates large-scale stockpiling, increased recycling capacity, and massive capital investment to counter China's 90% market share in processed rare earths.