G-7 leaders unite to secure key minerals, curb China dominance

The G-7 nations are working on an action plan to diversify the sourcing of critical minerals, aiming to curb their dependence on China. This move comes amid growing concerns over global supply chain vulnerabilities and is intended to strengthen investment in sustainable and responsible mining initiatives.

The Group of Seven (G-7) nations are intensifying efforts to secure stable supplies of critical minerals, aiming to reduce their reliance on China — a dominant force in the global rare earths market. At the upcoming summit in Kananaskis, Canada, G-7 leaders are expected to endorse a new “action plan” focused on diversifying mineral sourcing and accelerating investments in related projects, according to a draft document reviewed by Bloomberg.

Though the document does not explicitly name China, it references a “threat to our economies” stemming from current mineral supply practices — a clear allusion to China’s overwhelming control over key resources essential to modern technology and energy infrastructure. China is the source of nearly 70% of the world’s rare earth production and holds over 90% of global processing capacity for magnets, which are critical components in products ranging from smartphones and electric vehicles to wind turbines and household appliances.

In a move that has further heightened global concern, China recently imposed restrictions requiring special export licences for seven types of rare earth elements and the magnets manufactured from them. These curbs, effective from April 4, are viewed by many countries as a strategic maneuver in response to ongoing trade tensions, particularly with the United States.

The draft G-7 statement, as cited by Reuters, outlines a shared strategy to protect critical mineral supply chains and safeguard economic stability. It also emphasizes the importance of ensuring that mineral markets accurately reflect the costs associated with responsible mining, processing, and trading practices. The proposed measures are intended to encourage ethical and sustainable mineral development across allied nations.

Despite escalating restrictions, diplomatic negotiations continue. Last week, the U.S. and China reached a temporary agreement to continue the supply of rare earth magnets to the American market, even as Beijing enforces stricter export controls. This deal comes amid broader discussions related to tariffs and trade imbalances.

India, too, is actively engaged in dialogue with China regarding the export curbs. Commerce Secretary Sunil Barthwal stated on Monday that India is expecting a positive outcome from these talks, as the restrictions are already impacting key domestic sectors, particularly automotive manufacturing and white goods production.

As the G-7 prepares to formalize its response to the global minerals challenge, the push for diversified supply chains marks a pivotal shift in geopolitical strategy. By investing in alternative sources and reinforcing collaboration among allies, the bloc aims to secure the materials vital to future economic and technological resilience.