Securing the Supply Chain: An Analysis of US and European Critical Mineral Policies and Strategic Countermeasures for Korea

Dongsoo Kim
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Dongsoo Kim: Korea Institute for Industrial Economics and Trade

No 2, i-KIET Issues and Analysis from Korea Institute for Industrial Economics and Trade

Abstract: This report examines the rapidly evolving global landscape of critical mineral resources, highlighting the intensifying strategic weaponization of these materials by major powers. As China consolidates its monopolistic position in the refining, smelting, and processing of critical minerals, it increasingly leverages export controls as diplomatic and trade negotiation tools. In response, the United States is shifting its strategy under the second Trump administration, pivoting from providing subsidies for foreign investments toward securing independent domestic supply chains. The US approach heavily emphasizes bilateral cooperation with resource-rich nations and domestic project development. Concurrently, the European Union (EU) has enacted the Critical Raw Materials Act to systematically reduce its reliance on China. The EU aims to bolster regional autonomy by initiating 60 strategic projects spanning extraction, processing, and recycling. Within this geopolitical context, South Korea has laid a legal foundation through its three supply chain laws, yet faces inherent geographical limitations. This paper argues that South Korea must implement highly tailored, mineral-specific industrial policies, actively support corporate efforts to secure independent supply networks, and foster international partnerships to mitigate supply chain risks effectively.

Keywords: critical mineral resources; CMR; rare earths; rare earths elements; REEs; China; Chinese industry; minerals processing; minerals and mining; supply chains; global value chains; South Korea (search for similar items in EconPapers)
JEL-codes: F13 F14 F52 (search for similar items in EconPapers)
Date: 2026-01-28
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Published as i-KIET Issues & Analysis No. 202

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