Resource Nationalism On The Rise - Part 2: Unprecedented Government Intervention

A couple of years ago, I wrote an article about ‘Resource Nationalism’ in which I talked about a record deployment of clean energy technologies which were propelling unprecedented demand growth in the so-called critical minerals markets. As a result of this, these energy transition minerals, which used to be a rather small segment of the market, had moved to centre stage in the mining and metals industry. We were led to believe that all of this had in fact also pushed a shift in attitude towards the mining sector with a growing recognition that policy interventions were needed to ensure sufficient and sutainable mineral supplies. What was missing it seems, was a sense of urgency.

 

Today, the news headlines are still about these critical minerals. They have now become strategic linchpins crucial to not just energy transition, but also to national security and global power dynamics. I will therefore tackle this subject again today by highlighting the most recent developments, policy shifts, increased government involvement, and market forces in this much talked about but relatively unknown part of the global metals and mining industry.

 

Dual-use

Critical minerals -like for instance lithium, cobalt, nickel, rare earths, and copper to name just a few- are indispensable for green technology, defense systems, and advanced manufacturing. Their dual role has become fiercely topical this year due to three main drivers: the acceleration of clean energy ambitions, sharpening geopolitical tension, and -crucially!- mounting evidence of fragile, highly concentrated (as in: very dependent on China) supply chains. These drivers carry overlapping risks such as intensifying price volatility, the threat of export restrictions (again: think China), and heightened awareness of supply concentration that exposes countries and industries to potential shock.

 

Growing Consequences

Despite years of rhetoric, the US and Europe both still lag in mining and -even more important- in refining capacity. US and European automakers and battery makers are experiencing increasing raw material shortages, underlining the disconnect between policy ambition and industrial capacity. The slower pace of investment seems to have several roots. First of all, a regulatory drag as lengthy and complex environmental review processes often delay project approval for as long as 10 years. Second, labor shortages and high costs with the US facing only a handful of operational battery-grade lithium mines. The rest of the Western world is similarly constrained for cobalt and rare earth elements. Third, policy inconsistency all around as subsidies and strategic declarations have not translated into a pipeline of shovel-ready projects. The International Energy Agency (IEA) and policy analysts therefore warn that without urgent intervention, both regions risk ceding competitiveness to Asia, where China in particular has combined lower costs, vertical integration, and state support for decades.

 

A Wave of New Investments and Alliances

The past twelve months have produced a wave of high-profile government and private sector actions, many unprecedented for their size and strategic scope. Below we will briefly hightlight some of the more eye-catching developments.

• In October 2025, President Trump’s administration signed an expansive new pact with Australia to deepen supply chain integration, secure long-term offtake agreements for rare earths, and promote joint development of refining assets. This collaboration was framed as the first step in creating a Western-aligned alternative to Chinese supply dominance.
• On Trump’s most recent Asian tour, the US and Japan also signed a framework agreement to secure the supply of rare earths and critical minerals. The deal covers cooperation on extraction, recyling, stockpiling and investment in mineral supply chains, but no direct financial commitments were included.
• The US Export-Import Bank announcing seven formal Letters of Interest, totaling more than $2.2 billion, to support priority minerals projects in Australia.
• The International Finance Corporation (IFC), teaming with Orion Resource Partners, organizing a $1.8 billion fund to catalyze development and processing of strategically critical minerals.
• Appian Fund and IFC launching another $1 billion investment to direct capital into Africa and Latin America, aiming at unlocking new reserves and building processing infrastructure.
• Private sector moves like JPMorgan’s Security & Resilience Initiative, pledging up to $10 billion to bolster the US value chain for minerals essential to national security, spanning mining, processing, and related technologies.
• Several unprecedented direct US Interventions where the US government has recently stepped in to accelerate the development of producers such as Lithium Americas, MP Materials, and Trilogy Metals. These efforts are often combined with offtake agreements and stockpiling measures, signaling a new willingness to use federal muscle in strategic sectors.
• Agnico-Eagle, generally viewed as one of the gold producers with a solid capital allocation policy, announced the creation of a new subsidiary, Avenir Metals, focused on managing and advancing its portfolio of early-stage critical minerals investments. This closely follows the company’s investment in Perpetua Resources, which controls the Stibnite gold and antimony project in Idaho.
• Finally, the increasing government intervention is not limited to just a few critical minerals. In a seismic shift for America’s energy landscape, just last week Westinghouse Electric, which is owned by Cameco and Brookfield Asset Management, entered a partnership with the US government to accelerate the deployment of nuclear power in the US. At least $80 billion of new reactors are to be constructed across the US using Westinghouse nuclear reactor technology, targeting AI data centers and grid resilience.

 

The sum total of all these actions is very clear. The US is creating a sense of urgency and hereby setting an example for the rest of the world. The US is finally moving to actively direct both private capital toward resource nationalism, after decades of laissez-faire dependency. However, this increasing involvement of governments in private industries should be a concern to anyone who believes in free markets, but from a security of supply perspective, this news is definitely positive.

 

Make America Great Again

At the heart of these recent moves lies a stark reality: China still dominates the global supply and processing of critical minerals. Chinese companies control 60% of rare earth mining and almost all of the world’s rare earth refining, alongside commanding positions in processing lithium, cobalt, graphite, and other inputs vital to the energy transition. This dominance is not accidental: for over 25 years, China has built vast capacity through subsidies, strategic acquisitions, and tight alignment of government and companies.

 

As the West is now finally trying to catch up push to decouple or at least diversify its supply chains, it is facing several daunting constraints:

• Project timelines: It can take 7-10 years to permit, finance, and construct new mines or refineries, making any near-term reversal of Chinese dominance highly unlikely.
• Technical know-how: China leads not just in scale, but in technical expertise for complex refining of rare earths and battery-grade minerals.
• Cost and return: New western projects struggle to gain scale due to high input costs and environmental expectations, leaving Chinese processors with a cost advantage.

 

So while the US is incrementally moving the needle, with more joint ventures, investment deals, and memoranda of understanding, analysis by the IEA and industry strategists clearly suggests that it will take much more time than most people seem to realize before new investments actually yield meaningful autonomy from Chinese supply chains. The US has simply been asleep at the wheel for too long.

 

Europe’s Awakening

Europe has also recognized its acute vulnerability. The EU’s Critical Raw Materials Act already enshrined ambitious 2030 targets, and the parallel ReSourceEU program supports innovation in advanced recycling, new extraction technologies, and strategic stockpiling. By mid-2025, the EU had signed or expanded 14 strategic partnerships, including with Canada, Ukraine, Namibia, and others, to enable direct sourcing and joint investments in new mines and refining plants. Yet, political unity is sometimes limited. Environmental concerns and slow multi-state approval processes continue to stymie new mining ventures. That is exactly why just last week the European Initiative for Energy Security (EIES) in a new report urged the EU to earmark “substantial, dedicated” funding for critical minerals in its next budget. The group warned that the Europe risks of falling even more behind China and the US, both of which are already advancing state-backed mineral strategies. The EU must therefore ramp up support for its critical minerals sector and allow greater state intervention, EIES said in a statement. The group called on European institutions such as the European Bank for Reconstruction and Development and the European Investment Bank to take larger equity stakes in mining projects, following the US goverment’s investments over the last couple of months.

 

The verdict

The current lack of domestic mine supply of critical minerals in the West is exacerbated by an even bigger problem with an almost negligible refining capacity for several battery metals. Trafigura’s CEO Richard Holtum recently stated that the true bottleneck in the metals supply chain is indeed not the mining itself, but rather the refining and smelting capacity. Without sufficient refining infrastructure, mined materials remain “just dirt” because they cannot be processed into usable metals necessary for industries. That is why, even with the most recent cascade of billion-dollar deals, a meaningful rebalancing of the system will probably only occur over years, not months. Until then, the West will remain acutely vulnerable to supply disruptions, and resource security will endure as a dominant political and industrial theme.