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Preventing trade wars with the International Raw Materials Observatory and the Common Exploitation Booster

26/06/2019

A non-profit hub for sharing info on best practices for trade in raw materials was established thanks to the Common Exploitation Booster

Mineral raw materials are needed for just about every technological invention that we encounter today. They’re used for electronics, smart phones, aircraft, high-performance magnets and even jewellery. Some are called rare earths, but in fact they’re not that rare – although they are distributed unevenly across the planet. 

This uneven distribution means that some countries are more dependent on others for supplies of raw mineral material. 

For example, China is currently providing about 80% of the world’s supply of neodymium, which are needed to make intensely powerful magnets. You might not think that magnets are so widely used, but in fact, there are tiny magnets in almost all of the electrical devices you engage with on a daily basis, from your smartphone to your headphones to your car parts. 

A sprinkle of neodynmium makes a huge difference, and losing the supply could cast a society technologically backwards by a few decades. 

Since China holds the majority of the world’s neodymium magnet supplies, it would be a mistake to get on the wrong side of China, a fact that Trump seems to have forgotten.

Of late, China has been hinting that it may pull the plug on rare earth supplies to the US, in response to a recently introduced American piece of legislation that prevents US companies from buying equipment deemed a national security risk. The ban is widely assumed to refer especially to Huawei, the Chinese telecommunications company that Trump’s administration has accused of espionage and theft of technology. 

The goal of the International Raw Materials Observatory, established under guidance from the Common Exploitation Booster, is to make sure that such international disputes over raw minerals don’t happen. 

The non-profit organisation positions itself as an honest broker, trying to facilitate cooperation between the EU, Canada, the US, South Africa, Australia and Japan on raw minerals. 

They aim to ensure that those six actors will collaborate on minerals and rare earths, and ensure that everyone gets a fair supply.
 
However, its founder Vitor Correia warns that the Observatory only provides information – it’s up to politicians to take the necessary action. 

“We are just experts, providers of reliable information. It’s up to policymakers to decide if they use it or not,” he says. 

In the case of America vs China, he said that there are several US members on the board of the Raw Materials Observatory and that they are well aware of American dependency on Chinese raw minerals. However, politicians don’t always heed expert advice, he said.

“Information has a value, but in the end politicians, they use it or they decide simply to ignore it. It’s their choice,” he said. 

The Observatory was born as a result of the Common Exploitation Booster, an initiative that was powered by META Group and funded by the European Commission. The Common Exploitation Booster strove to help the recipients of European Commission research grants to put their results to good use. 

Overall, the Common Exploitation Booster helped more than 1872 organisations realise their potential. Some projects successfully promoted marketable products, while others developed non-profit organisations. 

INTRAW, a Horizon 2020 project that applied to be a part of the Common Exploitation Booster, had aimed to improve collaborations on raw materials between the EU and Australia, Canada, Japan, South Africa and the United States, and to create a map of best practices designed to lead to greater resource efficiency and sustainable use throughout all six members. INTRAW had done a lot of good research, and wanted to create a non-profit that could highlight those findings to the public and politicians. 

“META Group brought us a methodology that I was not using because my approach was based on SWOT analysis. META introduced us to the lean canvas, the business canvas, which was very useful to trigger discussion inside our consortium. Many of the people inside our consortium they are not used to such management tools, they are scientists,” said Correia.   

The biggest challenge for the Raw Materials Observatory going forwards will be communication of their work and raising their profile, so that the Observatory becomes the go-to organisation for information on raw minerals. 

“It’s difficult to make society at large (but also policymakers) understand the importance of having small term planning and long-term policy. Today, people prefer to have short term solutions instead of a long-term mentality. There’s more nationalism driving politics and politicians. If we want to have open free trade, this is quite the opposite from what we should be experiencing,” he said. 

For more information:
International Raw Materials Observatory website: https://intraw.eu/
 
Catherine Collins 
Communications Manager and Editor 
META Group 

Pablo Munilla  
Communications Officer  
META Group