The search for secure mineral supplies creates an opening to negotiate how the costs and benefits of the clean transition are shared. While developed economies aim to diversify supply chains and reduce reliance on China, resource-rich countries are pushing for local value creation (“beneficiation”). For critical mineral partnerships to succeed, importing economies must respond to producer countries’ industrial ambitions while pursuing their own geoeconomic interest.
This E3G/LSE IDEAS policy briefing examines why current critical mineral partnerships are struggling to move from diplomatic announcements to delivery. It breaks down the structural hurdles stalling new projects on the ground and outlines policy recommendations for aligning supply security with producer-country development:
- Support a broader range of economic opportunities: Local value creation extends beyond mineral processing; domestic firms can supply equipment, maintenance, engineering, logistics, and environmental services. Governments and development banks can support these activities through finance, technical standards, and sequencing within a broader industrial strategy.
- Share the costs and risks of diversification: Importing governments must contribute to development costs by combining loans, guarantees, and equity with long-term purchase commitments, targeted price-support mechanisms, and links to local benefits and environmental performance.
- Make technology and skills part of the investment deal: Negotiations should include agreements on training, joint research programmes, apprenticeships, processing pilots, and measurable commitments for local partners to gain technical and managerial experience.
- Build infrastructure for wider economic use: Power, transport, and water investments should be designed around the needs of domestic businesses and communities, with shared cross-border infrastructure and explicit agreements on costs and revenues where national markets are small.
- Fund implementation and public oversight: Sustained support is needed for public institutions in resource-rich countries to negotiate contracts, collect and allocate revenues, and enforce standards. Publishing agreements, reporting progress, and ensuring affected communities participate in decisions are crucial.
Read the full briefing here.
