Why critical minerals are reshaping global geopolitics (Full Transcript)

[00:00:00] Speaker 1: Welcome to the Global News Podcast on YouTube, where we get behind the headlines and focus on just one story. And today that story is what some call the mineral wars that are reshaping global politics. More than 50 countries are meeting in America to try to wrest control of this market away from China, these minerals going everything from smartphones to fridges. And I'm joined today by the BBC's business reporter, Jonathan Josephs, who's been following the story. Jonathan, what are we talking about here? What are these minerals?

[00:00:36] Speaker 2: This is a group of raw materials that are seen as absolutely vital for the global economy. The future depends on them. They're used for all sorts of things. A lot of it's to do with electronics and renewable energy storage of that. The creation of that is one of the big driving factors why we need so much more of it now. If you think about perhaps a smartphone that has a couple of grams maybe of lithium, but a battery for an electric vehicle will have several kilograms, so thousands of times more. And this is all driving a huge increase in demand for lithium. And that's just one of these minerals. There's a group of 20 that the International Energy Agency are now tracking in a lot more detail. They're trying to make sure that there is enough to go round. I mean, other applications for these things are, you know, you might find them in wind turbines, in solar panels, in the aerospace industry, in a jet engine perhaps, in defence. The defence industry uses them for all sorts of weapons. And they have rather unique chemical properties, which is why they are so important. In terms of the way they conduct electricity, or perhaps the heat resistance that they offer. Other important uses are in terms of computer chips, so that means they're very important for artificial intelligence and data centres, which are growing exponentially. And all of this means demand is surging, and there are questions about where it's all going to come from.

[00:02:03] Speaker 1: And I always hear those words, rare earths. It sounds like they're not all rare earths. This is a broader gamut of stuff, right?

[00:02:11] Speaker 2: Right, so rare earths is a group of 17 particular substances, which are particularly sought after. They've had a lot of headlines about them over the last year or two, because of their importance in geopolitical discussions, the US-China trade war in particular. China has implemented export controls on some of those, and also on some of the other minerals that we're talking about here. And the rare earths in particular are very hard to replace in terms of these processes, in terms of where you're using them, and these electronics, these weapons, whatever it is. And they're also particularly expensive and difficult to get hold of. Although they are kind of more common than the rare earths name suggests, finding them in sufficient quantities to make it economically viable to mine them, and then to refine them, and then to turn them into usable substances, that's much more difficult. And that's where they sort of get this moniker of rare earths from. Right.

[00:03:15] Speaker 1: And you've been talking to the International Energy Agency, the IEA, what did they tell you? Have we got a problem here?

[00:03:22] Speaker 2: Well, they certainly are concerned about where these supplies are going to come from. These critical minerals have become so important, it's now created a new division to keep track of them. And I've been speaking to the head of that division. He told me that the demand for these critical minerals is such a problem that there are growing questions about whether supplies can keep up with that rising demand. And he's also concerned about how diverse a source these are coming from. Is the supply chain resilient? Because China controls 19 out of 20 of the critical minerals that they are paying particular attention to. And we've seen, as we did last year, the export controls that they put in place, that China is prepared to use them as leverage in its wider geopolitical ambitions. So there is concern. And so if you think about it from perhaps a business perspective, most businesses wouldn't operate in this way where one particular supplier, in this case, China, has such a dominance. Why have they come to this position where they just have so much control? Yeah, China has been thinking about this for a long time, Keith. I mean, this goes back to the 1980s. It was 1987, in fact, I think, when Deng Xiaoping, the former leader of China, who was a big architect of economic reform there, is widely reported to have said, the Middle East has oil and China has rare earths. That gives you some idea of the significance of these materials. And that's rare earths. But China's expanded that into controlling raw materials from other descriptions as well. We've been talking about cobalt, nickel, lithium, etc. And they know that if they can control this, it gives them power in the global economy. China's become more integrated into the global economy over the last quarter of a century. And they've been prepared to accept some of the risks that comes with some of this mining and refining. There's a lot of environmental damage that can be caused. There are now ways to mitigate that, but it costs more money. So China has taken on some of those environmental risks for other countries, essentially, and in return has had control of these industries and been able to provide them more cheaply than perhaps they would be done elsewhere, where you'd have more strict environmental controls. What about America, then? What's President Trump trying to do? Yeah, so we've got this meeting happening in Washington. It's being hosted at the State Department by the Secretary of State, Marco Rubio. He's got delegations coming from 50-plus countries as ministers and officials from across the world, from the EU, Australia, New Zealand, the UK. And they're all trying to work out ways to work together. It's been a bit difficult to try and work out exactly what the agenda is for this meeting. But the guidance I've had has been sort of directing this to President Trump himself, saying that he's the one that's orchestrating this. It's under his leadership. We've also had President Trump this week saying that he's going to put $12 billion into creating a strategic reserve of critical minerals for the United States. So putting some money into it, which is what the International Energy Agency are advocating. And the other part of it is that America has also been looking at business deals around this. So they've put $12 billion into a rare earths mine, a financial support that is, into a rare earths mine in California. It's the only operational one in the country. And they have now moved to a position where they don't have to send that material to China anymore to process it into usable materials. And then we've also had this week the US government-backed consortium called Orion agreeing to buy 40% of two African copper and cobalt businesses from the mining giant Glencore. So there are these deals being made. President Trump isn't the first American leader to try and do anything about this. President Biden did make efforts towards this, but perhaps President Trump would say he's being more muscular, he's being more vocal and actually achieving more in terms of this. So there are these deals being made, but these are all long term ambitions because it takes a while, it takes many years really, to build a mining project up and to get the resources out of the ground and turn them into usable materials. These aren't short term fixes.

[00:07:57] Speaker 1: Thanks, Jonathan. That was the BBC's Jonathan Josephs. And if you like stories like this, remember you can listen to the Global News podcast from the BBC, which you can get from wherever you get your podcasts. And remember to like and subscribe this video so that you don't miss future editions. And let us know if you think there are any other stories we should be covering.