Metal and mineral importers and companies processing these raw materials are clearly benefitting from the shift to low-carbon technologies, the WVM said. While the industry group “of course” agreed that ensuring greater compliance with social and environmental standards would often be desirable “in principle” among source countries as diverse as the DR Congo, China or Canada, Germany would remain a “price taker with little influence to enforce its ideas on the market.” Despite budding attempts to scale up domestic lithium mining for e-car batteries and other still mostly rather small-scale ventures into exploring Europe’s own energy transition resource potential, the region’s relatively poor resource endowment would leave little wiggle room to change suppliers if they are found incompliant with ambitious standards. “We depend on imports for almost 100 percent of the metallic resources that we use. Europe as a whole cannot be self-reliant when it comes to metal supplies,” Schiweck said.
Obliging companies to certify compliance down to the very origin of all input components of any product among up to 5,000 direct suppliers would therefore border on the impossible for some companies, metal industry representative Schiweck said. Especially those processing raw materials into intermediate goods as the first supply chain link in import countries could easily become overstretched, he argued. Joint EU efforts, such as the European Raw Materials Alliance launched at the end of 2020 and backed by more than 150 companies from the sector, could help to bundle bargaining power and improve enforcement, but supply security would have to remain the chief concern. Rules already in place would often simply be ignored, he added. “There will always be some residual risks that cannot be entirely ruled out.
Industry umbrella federation BDI echoed these concerns, saying that a secure raw material supply for high-tech products would too often be “taken for granted.” There is a growing tendency to use quotas, tariffs or other trade restrictions on strategic minerals as political assets by source countries. While there is reason for optimism that a shift to renewable power will overall reduce conflicts over resources compared to the fossil age, the question who controls the levers to energy supply already plays a vital role in geopolitical modelling of the future and could alongside with global warming become a source for violent struggle. Besides that, bustling competition between green technology manufacturers from Europe, the US, China, Japan and other advanced markets would make it increasingly difficult to enter into long-term contracts with suppliers, a prerequisite for implementing “the highest social, environmental and human rights standards” that the German industry adheres to. Ultimately, however, industry could not perform “tasks of the state,” such as ensuring compliance with human rights in source countries, the BDI argued in a position paper.
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