The chancellor of germany, Olaf Scholzannounced on Sunday a new expanded commodity partnership with Chileduring a South America tour which Berlin hopes will help secure greater access to key critical minerals for the transition to a green economy.
Europe’s largest economy has lagged behind in the race for critical minerals, partly due to dislike of the environmental implications of the mining business, as well as faith in the open market, German government officials say.
This has led to dependence on China, which has invested heavily in the mining sector in resource-rich South America and in commodity processing. Now, however, growing demand for critical minerals and geopolitical concerns are creating momentum to better secure and diversify supply.
Germany, with its powerful auto industry, is especially concerned regarding getting more lithium, the ultra-light metal key to making batteries for electric vehicles. Argentina and Chile sit at the top of South America’s “lithium triangle,” which contains the world’s largest treasure trove of the metal, Archyde.com reported.
The new German-Chilean agreement, which replaces a decades-long partnership, aims to intensify cooperation in the sector. “We want to help Chile on the path towards a sustainable mining sector,” said Scholz in Santiago de Chile during his tour of the region. “Germany also wants to make sure mining creates more jobs in the countries of origin,” the official said.
“There is this expression, extractivism, that everything is extracted from the earth. But that’s not a good thing, when that’s all that happens,” he added. “The question is: can we not ensure that the first round of processing, which generates hundreds, if not thousands of jobs, can take place in the (source) countries? That would also save a lot of transportation,” he said.
