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France launches a critical metals investment fund

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France will create a €2 billion investment fund to facilitate access to critical metals needed for the energy transition. This fund will make it possible to take stakes in mines, processing and recycling units, and will aim to avoid dependence on the countries producing these metals.

This fund, to which the state will contribute 500 million euros in a “logic of public-private alliance”, is revealed before the exhibition Thursday by President Emmanuel Macron of his strategy to accelerate the “reindustrialization” of the country, followed by announcements on a new location of electric battery factories in Dunkirk (North).

This instrument, its promoters hope, will make it possible to ward off the spectre of dependence on countries producing these metals, which are crucial for the electrification of transport and which emit a lot of CO2. And this at a time when competition with other large consumers of these materials, such as the United States and China, is intensifying. These metals, whose demand could quadruple by 2040 against the backdrop of the global race to decarbonize, according to the International Energy Agency (IEA), include cobalt, nickel, manganese, lithium and platinum, in addition to the “rare earths”.

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Strategic issue

The critical metals fund “will allow to go in a targeted and strategic way, to take equity stakes”, minority, in mines, processing and recycling units, whether “in France, in Europe” but also in the rest of the world, explained to AFP the Ministries of Energy Transition and Industry, confirming information from Les Echos. After the priming of this fund to the tune of half a billion euros by the Caisse des Dépôts, the objective is to reach a total of 2 billion euros, according to the same source. The ministries did not wish to give names of companies that could join this scheme, either as investors or as buyers.

France must be at the rendezvous of a 21st century where power will be determined by access to these critical metals, after “a twentieth century that was centered on a question of possession of hydrocarbons”, according to them, an aggiornamento “essential not to pass from one dependence to another”. The fund will be managed by Paris-based private equity firm Infravia, which describes itself as “specializing in infrastructure investments and high-growth tech companies.” Infravia will be responsible for investment choices, but the ministries have referred to the “requirement to take socially and environmentally exemplary projects”, regardless of the countries involved.

 

Source: energynews

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