G20 leaders must address bottlenecks in the global supply of rare earth elements or risk blockages in economic growth and the fight against climate change, industry groups from around the world said on Monday.
“Without adequate supply to open access to such elements, global efforts to address climate change, promote innovation, and advance global growth will be significantly hindered,” the industry groups said in an open letter ahead of this week’s G20 summit in Seoul, South Korea.
The letter was signed by representatives of automakers, electronics manufacturers and energy producers, among other sectors, from industrialised and developing countries.
Uncertainty over access to rare earths — elements used in high-tech sectors from carmaking and electronics to Internet fibre optics and renewable energy — has caused alarm across the world following a decision by China to curb exports in 2011.
China controls about 97 percent of global rare earth production, but says it wants to cut exports for environmental reasons. New mining projects in the United States, Canada and Australia will take several years to reach production.
“G20 leaders should work together to find pragmatic and sustainable short-term solutions for a stable and secure rare earth supply,” said the letter, signed by 37 associations from the United States, the European Union, Brazil, Japan, South Korea and India.
The groups warned of acute trade tensions between the world’s major economies resulting from supply cuts.
The EU, United States and Mexico are currently challenging Chinese export restrictions on raw materials, and EU officials say they are monitoring the situation while deciding whether to take more legal action against Beijing.
“Further trade disputes cannot be in the interest of all G20 nations,” the letter said.
G20 leaders should commit themselves to refraining from export taxes or quotas, renouncing interference in the commercial sale of rare earths, collaborating to diversify rare earth mining and improving rare earth recycling, the groups said.
Among the letter’s signatories were the Alliance of Automobile Manufacturers, the American Petroleum Institute, BusinessEurope, the Japan Electronics and Information Technology Industries Association, the Federation of Korean Industries and the Brazil-U.S. Business Council.
