March 17, 2023
2 mins read

EU unveils act to secure supply chains

It sets clear goals for 2030, with 10 per cent of the EU’s annual consumption for extraction, 40 per cent for processing and 15 per cent for recycling….reports Asian Lite News

The European Commission has proposed an act aiming at securing sustainable supply chains of critical raw materials for the European Union (EU) member states.

The European Critical Raw Materials Act (CRM Act) will ensure the EU’s access to a secure, diversified, affordable and sustainable supply of critical raw materials, as critical raw materials are indispensable for a wide range of strategic sectors, including the net zero industry, the digital industry, the aerospace and the defence sectors, the Commission said in a statement.

The CRM Act lists critical raw materials, as well as strategic raw materials, aiming to achieve the region’s green and digital transition and to reduce the bloc’s dependence on imports from outside, reports Xinhua news agency.

It sets clear goals for 2030, with 10 per cent of the EU’s annual consumption for extraction, 40 per cent for processing and 15 per cent for recycling.

“This act will bring us closer to our climate ambitions. It will significantly improve the refining, processing and recycling of critical raw materials here in Europe. Raw materials are vital for manufacturing key technologies for our twin transition — like wind power generation, hydrogen storage or batteries,” said Ursula von der Leyen, president of the Commission.

The proposed act also addresses the current dependency of the EU by specifying that no more than 65 per cent of the bloc’s annual consumption of each strategic raw material at any relevant stage of processing should come from a single third country.

Under the CRM Act, red tape will be simplified, especially when it comes to extraction and recycling permits. CRM supply chains and stocks within the EU will be monitored to ensure the resilience of supply chains.

Research and development, as well as relevant skills, will be boosted. Labour rights, human rights and environmental protection are also part of the CRM Act.

As the EU’s own resources in critical raw materials are not sufficient to meet the bloc’s demand, it needs to rely on partner countries. In order to avoid dependencies on third countries, the EU aims at diversifying suppliers.

Among other actions, the EU proposes to establish a Raw Critical Materials Club to bring like-minded suppliers and consumers together, to include dedicated chapters in future free trade agreements, and to work with the World Trade Organization on the topic as well as with the Organization for Economic Cooperation and Development.

The CRM Act is one of the cornerstones of the EU’s Green Deal Industrial Plan, together with the Net-Zero Industry Act, which sets a target for the EU to produce 40 percent of its own clean tech by 2030.

The proposal needs to be approved by all the EU’s 27 member states, a process set to take many months, perhaps over a year.

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