Germany is urged to adopt a comprehensive approach to safeguard its supply of essential raw materials amidst the global transition towards decarbonization and digitalization. The recommendation comes from KfW, a government-owned financing institution, based on a research report by IW Consult and Fraunhofer ISI.

The report examined supply risks along the production and supply chains for key raw materials such as copper, lithium, and rare earth minerals. It highlighted significant dependencies in sectors crucial to German manufacturing, particularly the automotive industry. Supply vulnerabilities arise primarily due to limited suppliers, emphasizing the need for diversification to bolster resilience.

Each raw material presents unique risks, necessitating a multifaceted strategy encompassing various measures. Promoting technological advancements, particularly in substitution and material efficiency, is cited as a crucial overarching approach.

Germany’s transition to renewable energy aims to establish a sustainable economy but relies heavily on resources vital for green technologies. However, the production and disposal of products containing these raw materials can pose environmental and social risks. With its strong presence in wind and solar energy production and the automotive sector, Germany faces significant challenges in ensuring resource procurement aligns with climate goals without adverse environmental impacts.