Daniel Alejo, ERC Research Project Curiae Virides, Brussels School of Governance (Vrije Universiteit Brussel).
Marta Ibero, Master's degree on Human Rights (Université Catholique de Louvain).
This blog post provides an overview of the EU’s framework to secure its supply of critical minerals essential for boosting its competitiveness, achieving its climate goals, and strategic autonomy while ensuring the respect of human rights and the protection of the environment. By discussing the Critical Raw Materials Act and the EU’s raw materials diplomacy, this piece underscores the necessity of promoting policy coherence with the Directive on Corporate Sustainability Due Diligence. It also discusses the risks of perpetuating neo-colonial dynamics with non-EU countries and exacerbating human rights violations and environmental impacts linked to critical minerals' value chains. Finally, it outlines the opportunities for meaningful sustainability due diligence, emphasizes the need for better policy alignment, and advocates for a sufficiency-first approach consistent with other EU regulations related to the circular economy.
The EU and the global race for critical raw materials.
Today, the global economy and a wide range of technologies across all industries rely on the unique physical properties of critical minerals such as cobalt, lithium, rare earths, nickel, and copper. These minerals are crucial components for the digitalization, electrification, and decarbonization of the global economy, and primary extraction and processing constitute their predominant source. The International Energy Agency's (IEA) latest estimates forecast that the demand for minerals used in clean energy technologies will double by 2030 compared to current levels, based on a scenario reflecting today’s policy settings. Despite their importance, the global supply chains of critical minerals are complex, fragile, and vulnerable to a wide range of risks, including geopolitical tensions and competition. Several countries seek to diversify and secure their mineral supplies with new policy interventions, including the United States’ Inflation Reduction Act and Canada’s Critical Minerals Strategy, among others.
Against this background, the EU has adopted the Critical Raw Materials Act (CRMA) to secure access to minerals deemed critical due to their high economic importance and exposure to high supply risk. The EU is also expanding its external engagement to diversify supplies through trade agreements, strategic partnerships, and the Global Gateway strategy, its new development initiative aimed at mobilizing investments in key sectors, including critical raw materials value chains. Simultaneously, the EU has established human rights and environmental due diligence obligations for large companies operating in its market through the Directive on Corporate Sustainability Due Diligence (CSDDD). In principle, these obligations should also apply to companies in the critical minerals sector. However, it remains unclear how these potentially conflicting goals can be reconciled, given that a rapid increase in demand for critical minerals in the EU will inevitably require expanding mining and processing operations with significant social and environmental consequences, particularly in resource-rich countries.
European frameworks on critical raw materials, and human rights and environmental due diligence.
Critical Raw Materials Act:
Through the Critical Raw Materials Act (CRMA), the EU aims to make its supply of critical raw materials (CRMs) more secure, resilient, and sustainable. The CRMA identifies 34 critical materials and 17 strategically important raw materials (SRMs) based on their significance for the green and digital transition, as well as their applications in the defence and aerospace sectors. For example, the EU considers lithium an SRM due to its complete reliance on imports from third countries, particularly Chile (79%), and its economic importance in battery production. The CRMA establishes non-binding benchmarks to enhance mining, processing, and recycling capacity within the EU while diversifying SRMs imports by 2030. It also designates Strategic Projects aimed at strengthening capacities to secure the supply of strategic raw materials. These projects will benefit from improved access to finance, reduced administrative burdens, and shorter permitting timelines.
The CRMA acknowledges the adverse social and environmental impacts associated with the supply of CRMs and promotes the sustainable implementation of projects, particularly regarding the monitoring, prevention, and minimization of environmental and social harms. However, the Act only references a set of voluntary, non-binding principles for sustainable raw materials defined by the EU Commission for projects implemented within the EU (EU principles for sustainable raw materials). Moreover, it does not explicitly mention any social and environmental requirements for projects carried out in third countries, nor the due diligence obligations established by the CSDDD.
The EU Raw Materials Diplomacy
As part of its Raw Materials Diplomacy, the EU is pursuing free trade agreements, strategic partnerships, and policy dialogues with non-EU producing countries. By December 2024, it had signed 14 strategic partnerships on raw materials with third countries including Argentina and Chile in 2023. Furthermore, the Global Gateway strategy has become a key pillar of the EU’s raw materials external action by mobilizing investments in the critical raw material value chains. The strategy brings together the EU, member states, their financial and development institutions, the European Investment Bank (EIB), the European Bank for Reconstruction and Development (EBRD), and the private sector to leverage investments through a collective approach known as Team Europe. For example, in Argentina and Chile, the Global Gateway aims to deepen cooperation on CRMs through infrastructure investments in lithium and copper value chains. Other projects within the Global Gateway strategy aim to strengthen the strategic partnerships signed with Namibia, Zambia, the DRC, and Kazakhstan. However, specific project details, funding structures, stakeholders involved, and development goals have not yet been made publicly available.
Directive on corporate sustainability due diligence:
In June 2024, EU Member states voted on the final decision regarding the Directive on Corporate Sustainability Due Diligence (CSDDD). The CSDDD establishes obligations of human rights and environmental due diligence to large companies (i.e. >EUR 450 million net turnover worldwide) domiciled in the EU and/or operating on the EU market. These responsibilities include identifying, preventing, terminating, mitigating, and remediating adverse human rights and environmental impacts in the company’s operations, their subsidiaries, and, where related to their chain of activities, those of their business partners. In addition, the directive sets out an obligation for companies to adopt and implement a transition plan to align with the Paris Agreement goals and the EU climate neutrality targets. The directive establishes a common, mandatory sustainability due diligence framework across the EU, thereby overcoming the previously unclear and fragmented legal landscape.
The CSDDD identifies the raw materials chain of activities as potentially impacting human rights and the environment. Consequently, due diligence requirements apply to all stages of the raw materials chain of activities, from upstream (i.e., exploration and mining) to downstream (i.e., manufacturing and distribution companies). Despite these due diligence obligations, it remains unclear how the directive will be aligned and applied to companies operating in strategic sectors such as critical raw materials. This is especially relevant in the context of applying due diligence obligations to strategic projects under the CRMA and those within the Global Gateway strategy, which aim to strengthen strategic raw materials capacities across all value chain stages, both within and outside the EU.
The EU at the crossroads: Neo-colonial dynamics and socio-environmental impacts.
The CRMA provides fragile human rights and environmental protection while promoting the expansion of CRMs projects and trade deals with resource-rich countries. This approach risks intensifying the overexploitation of resources and the socio-environmental impacts associated with it without challenging the EU's high demand for CRMs. Moreover, the EU Global Gateway strategy risks reproducing neo-colonial relations that prioritize EU business and geopolitical interests over other social and environmental goals. Some NGOs have denounced that the Global Gateway strategy promotes the privatization of infrastructure and public services in the energy sector in the “Global South”, and increases the debt burden of partner countries. They also highlighted the disproportionate influence of large corporations and sector federations, in contrast to the marginal role given to civil society actors, undermining the narrative of mutual benefit promoted by the Global Gateway.
Lithium mining in Chile and Argentina
Further increases in demand for lithium in the EU materialized through the strategic partnerships signed with Argentina and Chile may exacerbate social and environmental impacts in the region and create "Green Sacrifice Zones". These are areas severely contaminated by the sourcing, transportation, installation, operation, and end-of-life treatment activities of a low-carbon economy. For example, some of the most visible impacts related to lithium mining through brine extraction in the so-called “Lithium triangle” (which spans Chile, Argentina, and Bolivia) include freshwater resource depletion, violations of local and Indigenous cultural rights, loss of livelihood, biodiversity loss, and the social fragmentation and marginalization of local communities. By expanding the frontiers of global value chains for critical minerals, the EU and its partner countries increase the risks of sacrificing a certain space, ecosystem, and people to achieve certain climate, energy, or economic goals.
Looking forward and reflections
To balance its critical materials needs with human rights and environmental protection, the EU needs better policy alignment between the Critical Raw Materials Act (CRMA), its external actions, and the Corporate Sustainability Due Diligence Directive (CSDDD). This alignment should ensure that human rights and environmental commitments are not overshadowed by business, military, or geopolitical interests.
Firstly, the EU should expand the scope of the CSDDD to include all companies within the critical raw materials value chain, regardless of size, ensuring they comply with due diligence obligations. Prioritizing human rights and environmental protection should be fundamental when identifying strategic projects and investments under the CRMA and the Global Gateway strategy. Secondly, the EU should implement a transparent stakeholder engagement mechanism to define, implement, and monitor strategic projects and partnerships, ensuring active and meaningful civil society involvement in both EU and non-EU countries. Thirdly, the EU and its partner countries should avoid replicating neo-colonial dynamics, ensuring that local environments and communities are not sacrificed for "green" or economic goals. Finally, the EU should reduce its overall demand for primary raw materials by embracing a sufficiency-first approach: reducing consumption, enhancing circularity, and prolonging product lifespan. Ultimately, as several organizations have advocated:
The most sustainable, and least critical resource is the one that is not used or mined.
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