Europe’s Supply Chain Security Dilemma
Beijing has become more explicit in weaponising trade dependencies through export controls, particularly in critical minerals and rare earth elements (REEs). Europe now faces a structural dilemma: how to reduce strategic vulnerabilities relative to China without shifting towards increasing dependencies on the United States.
This brief examines two key pressure points for European strategic value chains: EVs (and batteries in particular) and rare-earth permanent magnets. Furthermore, it evaluates emerging U.S. counter-initiatives such as Pax Silica and FORGE. The conclusion is straightforward: rather than reducing exposure, recent European trade and industrial policies have largely redistributed dependence across different segments of strategic value chains. Europe must pursue an international economic agenda of diversification of supplies while strengthening supply-chain resilience, not bloc alignment.
This brief was first published in ReConnect China and the full text can be read there.
(Photo credit: Wikimedia Commons)