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Sweden’s strategic Initiative in Europe’s rare metal supply chain: Sustainability goals and geopolitical shifts

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Europe’s pursuit of climate and sustainability targets, coupled with a desire to reduce dependency on a single autocratic superpower, underscores the critical need for a stable supply of rare metals. Positioned strategically, Sweden aims to play a pivotal role in this evolving landscape.

In her 2022 State of the European Union address, European Commission President Ursula von der Leyen emphasized the increasing importance of lithium and rare earth metals, likening their significance to that of oil and gas. This acknowledgement reflects Brussels’ recognition that overcoming bureaucratic hurdles and thinking strategically about critical mineral supply chains are crucial for the bloc’s relevance and resilience.

As countries globally seek to mitigate risks associated with reliance on China, Europe is reassessing its stance on mining and mineral processing. In March 2023, the European Commission introduced the European Critical Raw Materials Act, a regulatory framework aimed at ensuring the safe and sustainable supply of critical raw materials. The European Parliament endorsed the proposal in December, followed by adoption by the European Council in March.

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A stable supply of rare metals is imperative for developing cutting-edge industries. These critical raw materials, essential for digital advancements, security, and the green transition, have become focal points for major powers like China and the United States amid their technological competition.

Europe currently imports these metals predominantly from China, which poses environmental and health risks and undermines the EU’s sustainability goals. This heavy dependency has led rare earth metals to be classified as “at risk” for scarcity within the EU. Despite large deposits existing outside China, such as in Greenland, accessing them presents significant challenges.

Sweden has historical roots in rare earth metal discovery, dating back to the late 18th century. Today, with the global shift towards electrification and advanced technologies, Sweden is poised to leverage its expertise in rare earth elements (REEs) as a strategic alternative to China.

The Norra Karr project, situated east of Lake Vattern, exemplifies Sweden’s potential. It boasts high concentrations of sought-after REEs and low uranium and thorium levels, making it economically promising and environmentally viable. However, the road to opening a mine is arduous, involving lengthy approval processes, infrastructure development, and stringent environmental assessments.

Moreover, mining alone does not alleviate supply chain risks if Europe remains dependent on China for processing these raw materials into high-tech intermediate products. China’s dominance in processing technologies for rare earths underscores the complex interplay between mining, processing, and global supply chains.

Addressing these challenges requires streamlining approval processes for strategic resource projects within the EU and fostering partnerships that enhance Europe’s capacity to process these materials domestically. As Europe charts its course towards greater autonomy in rare earth sourcing, Sweden stands ready to play a crucial role in shaping the continent’s future in the global minerals landscape.

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