The federal government is launching a new initiative to support foreign mineral projects, specifically excluding those based in China, as part of a broader strategy to bolster U.S. supply chains. The Export-Import Bank (EXIM) is leading the effort, approving funding for foreign projects supplying minerals crucial to American manufacturing.
This initiative aims to reduce reliance on China, a global hub for mineral production and processing, particularly rare earth elements, where China holds a substantial 90% market share. EXIM’s new financing tool seeks to direct capital toward projects not currently attracting sufficient U.S. investment, supporting American businesses access to critical resources.
"This initiative will provide U.S. businesses with access to critical resources, reduce reliance on China-controlled supply chains, and strengthen our domestic manufacturing base," stated EXIM President and Chair Reta Jo Lewis.
Recent tensions between the U.S. and China, including China's announced export restrictions on certain minerals, including gallium, germanium, and antimony with potential military applications, are further motivating this strategy. While EXIM can already fund mining projects, the new initiative is focused on channeling funding toward projects with less inherent export potential to the U.S.
Minerals are critical for U.S. national security, technological advancement, and climate goals, being integral to semiconductors, renewable energy, and other key technologies. Bipartisan concerns regarding China's dominance in global mineral supply chains have prompted a multi-faceted government response.
Beyond EXIM, broader initiatives are underway across the federal government. The Biden administration has undertaken reviews of critical mineral supply chains and launched a campaign to establish international partnerships for mineral processing to reduce China's influence in this sector. The Inflation Reduction Act, passed in 2022, also includes substantial investments in battery technology and related mineral sectors, complementing the broader strategy.
Legislative action is also taking place; the House Select Committee on the Chinese Communist Party has established a critical minerals working group and introduced bills addressing geologic mapping, mineral resource assessments, and attracting foreign talent to the U.S. International cooperation, such as the recent agreement with Japan focused on circular economy approaches, is also enhancing the U.S.'s response to these challenges.
