Policy Paper: The Global Institute for Strategic Studies (GISS)
The twenty-first century is witnessing the emergence of a new strategic competition that may ultimately prove as consequential as the race for oil that shaped the previous century. As governments and industries accelerate investments in artificial intelligence, advanced semiconductors, electric vehicles, renewable energy systems, quantum computing, and next-generation military technologies, critical minerals have become the foundation of economic competitiveness and national security.
Lithium, rare earth elements, graphite, cobalt, nickel, gallium, germanium, copper, and other strategic minerals are no longer viewed merely as industrial commodities. They have become geopolitical assets capable of influencing global supply chains, technological leadership, military readiness, and the international balance of power.
The competition surrounding critical minerals increasingly resembles the geopolitical importance oil held throughout the twentieth century. However, unlike oil, which was concentrated primarily in the Middle East, critical mineral supply chains are geographically dispersed but heavily concentrated in processing and refining capacity. China currently dominates many of these stages, creating vulnerabilities for Western economies and prompting an unprecedented effort to diversify supply chains.
This paper argues that competition over critical minerals will become one of the defining geopolitical struggles of the coming decades. The countries that secure access to these resources, develop processing capabilities, and control critical supply chains will enjoy significant advantages in the global race for technological and strategic leadership.
Introduction
Throughout modern history, control over strategic resources has shaped the rise and fall of great powers.
Coal powered the Industrial Revolution. Oil fueled the twentieth century and became central to military power, economic growth, and international politics. Today, a new category of resources is emerging as the foundation of global competition: critical minerals.
The transformation is being driven by profound technological change. Artificial intelligence systems require advanced semiconductors. Electric vehicles depend on lithium-ion batteries. Renewable energy infrastructure requires copper, nickel, rare earth elements, and other specialized materials. Modern fighter aircraft, satellites, missile systems, drones, and communication technologies all rely on highly sophisticated mineral supply chains.
As a result, access to critical minerals increasingly determines a state’s ability to compete economically, innovate technologically, and defend itself militarily.
The geopolitical implications are enormous.
Unlike previous industrial revolutions, the digital and green transitions depend upon a relatively small number of highly specialized resources whose supply chains remain vulnerable to disruption, political manipulation, and strategic competition.
The world is therefore entering a new era of resource geopolitics.
Understanding Critical Minerals
The term “critical minerals” refers to natural resources that are economically important, difficult to substitute, and vulnerable to supply disruptions.
Different countries maintain different lists, but most include lithium, cobalt, graphite, rare earth elements, nickel, manganese, gallium, germanium, titanium, tungsten, and several other strategic materials.
These minerals perform functions that cannot easily be replaced in advanced technologies.
Lithium serves as a key component in battery storage systems.
Rare earth elements are essential for permanent magnets used in wind turbines, electric vehicles, and military systems.
Gallium and germanium play critical roles in semiconductors, telecommunications, and aerospace applications.
Graphite remains indispensable for battery production.
Copper is essential for electrification, renewable energy infrastructure, and modern industrial systems.
Demand for many of these minerals is expected to increase dramatically over the coming decades.
The International Energy Agency has repeatedly warned that global demand for minerals linked to clean energy technologies could multiply several times by 2040.
The AI revolution is likely to accelerate this trend further.
China’s Dominance and the New Strategic Dependency
Perhaps the most significant feature of the critical minerals landscape is China’s dominance.
Although China does not possess all global reserves, it has invested for decades in mining operations, processing facilities, refining capacity, logistics networks, and industrial ecosystems.
Today, China controls large portions of global processing and refining capacity for several critical minerals.
In some sectors, Chinese companies dominate over 70 percent of global processing.
This position provides Beijing with substantial economic and strategic leverage.
The significance of this dominance extends beyond commercial competition.
Modern supply chains depend not merely on access to raw materials but on the ability to process them into usable industrial inputs.
Mining a mineral and refining it into battery-grade material are fundamentally different capabilities.
Many Western countries possess geological resources but lack sufficient processing infrastructure.
This creates a strategic vulnerability.
Recent export restrictions imposed by China on materials such as gallium and germanium have highlighted how resource dependencies can become geopolitical tools.
For policymakers in Washington, Brussels, Tokyo, and other capitals, reducing this vulnerability has become a strategic priority.
The United States and the Critical Minerals Strategy
The United States increasingly views critical minerals through a national security lens.
American policymakers recognize that technological leadership in artificial intelligence, semiconductor manufacturing, advanced weapons systems, and clean energy technologies depends upon secure supply chains.
Recent legislation and industrial strategies reflect this understanding.
Federal investments have sought to encourage domestic mining, processing, battery manufacturing, and semiconductor production.
The United States has also expanded partnerships with allies including Canada, Australia, Japan, and European countries to diversify access to strategic resources.
However, significant challenges remain.
Developing new mines often requires years of environmental assessments, regulatory approvals, infrastructure development, and financing.
Local opposition to mining projects further complicates efforts to expand domestic production.
As a result, the United States faces a difficult balancing act between environmental objectives, industrial policy, and strategic competition.
Europe’s Resource Vulnerability
Europe faces an even more complex challenge.
The European Union possesses ambitious goals regarding green energy, climate neutrality, industrial competitiveness, and technological sovereignty.
Yet many of the resources required to achieve these objectives are imported.
European dependence on external suppliers became painfully visible during the energy crisis that followed Russia’s invasion of Ukraine.
Policymakers are determined to avoid a similar dependency regarding critical minerals.
In response, the European Union introduced the Critical Raw Materials Act, designed to strengthen domestic production, expand recycling, diversify imports, and reduce strategic vulnerabilities.
The objective is not complete self-sufficiency.
Rather, Europe seeks resilience through diversification.
The challenge is that competition for resources is intensifying globally.
Securing reliable supplies will require long-term investments, strategic partnerships, and sustained political commitment.
Africa: The Emerging Resource Battleground
Many of the world’s most important critical mineral reserves are located in Africa.
The Democratic Republic of Congo produces the majority of global cobalt supplies.
Zambia possesses significant copper reserves.
Zimbabwe contains substantial lithium deposits.
Several other African countries are emerging as major players in global mineral supply chains.
This has transformed Africa into a central arena of strategic competition.
China, the United States, the European Union, India, Türkiye, and Gulf states are all expanding investments across the continent.
Infrastructure projects, mining concessions, development assistance, and diplomatic engagement increasingly revolve around access to strategic resources.
For African governments, this presents both opportunities and risks.
Resource wealth can support economic development, industrialization, and infrastructure investment.
However, it may also generate governance challenges, environmental concerns, corruption risks, and external dependencies.
The future of global mineral markets will be shaped significantly by decisions made across Africa.