The lack of equity investment from financial institutions in the critical raw materials sector is hindering European efforts to meet ambitious green targets, according to Bernd Schaefer, CEO of EIT RawMaterials.
Schaefer emphasized the need for downstream players to commit to supporting the sector, citing the Critical Raw Materials Act (CRMA) as a guide for moving forward. Under the CRMA, the EU has set targets for domestic production of essential minerals by 2030, including increased mining, recycling, and processing within Europe.
With demand for key materials such as copper, nickel, and rare earths expected to surge, Schaefer stressed the urgency for more investment and support from governments and industry players. While countries like France, Germany, and Italy have initiated investment funds, more action is needed to address the growing demand for critical materials.
In contrast to Europe, the US has introduced significant tax incentives for domestic production in green technology sectors. Germany’s Vacuumschmelze (VAC) has partnered with General Motors to establish a factory in North America for rare earth permanent magnets, underlining the need for a coordinated EU action plan in this area.
Companies like Neo Performance Materials are already taking steps towards increasing production capacity, with a new rare earths magnet factory set to launch in Estonia next year. Schaefer remains optimistic about European companies’ ability to adapt and innovate in the face of growing global competition.
As the race for critical raw materials heats up, it’s clear that more investment and commitment are essential for the EU to achieve its climate goals and maintain competitiveness on the global stage.
