Berlin (Brussels Morning Newspaper) – German Chancellor Friedrich Merz and Canadian Prime Minister Mark Carney announced on Tuesday that they will sign an agreement on strengthening cooperation in the field of critical raw materials, as they strive to lower heavy reliance on China.
During a press conference in Berlin with Canadian Prime Minister Mark Carney, Merz announced that Canadian and German officials would sign a memorandum of understanding regarding raw materials.
“This is a collaboration that I very much welcome and that we support,”
The German leader expressed. “It is a positive step towards strengthening our economies and making them more secure.”
What does the memorandum of understanding aim to achieve?
Reports suggest the agreement will have five overarching objectives around technologies involved with processing, refining, and recycling raw materials. The materials to be included are rare earths, lithium, and copper – materials that Canada can supply and that Germany will be interested in. Canada and Germany also want to increase their involvement in international raw materials initiatives.
What role will innovation, investment, and collaboration play?
Canadian PM Carney stated that the two nations will sign a joint declaration of intent regarding critical mineral cooperation, aiming to accelerate innovation, investment, and collaboration. He noted that various indicators, such as trade impacts globally and the Ukraine, along with the pandemic, have outlined the vulnerabilities in critical mineral supply chains.
Carney pointed out that Canada and Germany will be financing substantially in the name of national security, and referenced a commitment to higher defense spending because of a NATO commitment.
But he noted the need to spend this money “as efficiently as possible” while also considering military interoperability and support, as well as the economic benefit to allies.
How does China’s dominance in rare earths affect markets?
Beijing’s imposition of export limits on some minerals this year has recently put China at the forefront of providing the world with rare earth elements, leaving businesses around the world unsettled. These elements are important to many products that power the world, for example, electric vehicle batteries, wind turbines, and computer hard drives.
What recent past agreement ensued between Germany and Canada?
Besides this raw material agreement, previously in 2022, Germany and Canada also signed an important agreement to establish a hydrogen alliance that aims to begin shipments of clean Canadian hydrogen to Germany by 2025. The hydrogen alliance also included various discussions of energy security, as well as LNG as part of a wider energy transition.
