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Molten copper in a metalworks in Hamburg, Germany.
© Martin Leissl/Bloomberg
According to the US news service Bloomberg, the traffic light government wants to invest one billion in raw materials investments in order to reduce dependence on China.
(Bloomberg) -- The German government has earmarked about 1 billion euros for raw materials investments to reduce dependence on producers like China for key minerals, according to people familiar with the plan.
A selection process will be put in place to determine which projects - including extraction, processing and recycling of materials - are eligible, said the people, who spoke on condition of anonymity.
The financing, which is provided via the state-owned KfW development bank, will consist of equity capital for the acquisition of minority interests.
The projects in Germany and abroad will “contribute to securing the supply of critical raw materials,” said a spokeswoman for the Ministry of Economic Affairs.
The ministry did not provide any details about the structure of the state fund.
Raw materials for Germany: billion-dollar fund to be set up for four years
Pandemic-triggered supply chain disruptions around the world and Russia's invasion of Ukraine have shown the vulnerability of Europe's reliance on energy and raw materials for high-tech and environmental projects.
The government of Chancellor Olaf Scholz (SPD) has pledged to step up efforts to ensure access to critical raw materials in the long term.
Raw materials such as cobalt, copper, lithium, silicon and rare earths are needed to make microchips, wind turbines and batteries for electric vehicles.
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The billion-dollar fund is to be set up for four years.
The investments will be coordinated with Italian and French initiatives in the raw materials sector, it said.
Policymakers will focus on projects defined as critical in the European Union's Critical Raw Materials Act.
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Economist Veronika Grimm, a member of Scholz's panel of independent economic advisers, said the goal of diversifying raw material supplies must be a "top priority" for the EU as a whole.
“The commodities fund can be an element, but it will not be enough,” Grimm told Bloomberg.
Germany still needs to build a structure to organize its investments in raw materials
KfW declined to comment on the plans.
The lender is expected to make a statement on its role in managing the project at its annual press conference.
The EU agreed in November on measures under the Critical Raw Materials Act to promote domestic mining and reduce dependence on a single country.
While Germany still needs to build a structure to organize its investments in raw materials, Japan could provide a model.
Since 2004, the state-run Japan Organization for Metals and Energy Security has invested in raw materials storage, explored reserves, provided loans or guarantees to raw materials companies and directly purchased their stocks.
By Kamil Kowalcze with assistance from Carolynn Look.
We are currently testing machine translations. This article was automatically translated from English into German.
This article was first published in English on February 2, 2024 at the “Washingtonpost.com” - as part of a cooperation, it is now also available in translation to readers of the IPPEN.MEDIA portals.