The EU must U-turn its trade policy – new Raw Materials Act (CRMA) helps cement an unjust world order
We, civil society organisations advocating for trade justice worldwide, are deeply concerned about the European Union’s strategy for accessing critical materials, recently published in a new Critical Raw Materials Act (CRMA). The Act reveals that the EU’s priority is to secure access to the raw materials market and preserve European interests abroad by signing new trade and investment agreements with specific chapters and rules on access to critical raw materials in third countries (the “Energy and Raw Materials” chapters). Although the Act comes under the guise of a green energy transition, we are concerned that the move comes without regard for planetary limits, overconsumption and its human and environmental impacts.
While energy security is crucial, we are alarmed by the EU’s push to fast-track trade agreements as a means of diversifying sources. Among these agreements are the EU-Chile, EU-Mercosur, EU-Mexico, EU-Australia, EU-New Zealand, and EU-Indonesia agreements. The EU’s historical trade policy has been driven by the pursuit of guaranteed access to raw materials, particularly from Global South countries, leading to the extraction of resources, the exploitation of communities and territories, and the environmental devastation. We see no effort to question or change the production and consumption model of the past decades in the recent publication, and the EU’s strategic push for supply chain diversification and fast conclusion of trade agreements continue to focus on ensuring access to raw materials.
To achieve a sustainable and just transition, we must consider climate change and limited resources.
The EU is fully dependent on some critical raw materials for the realisation of its Green Energy transition and for future technologies. Even though at first glance, securing access to materials for a green transition sounds like a progressive ecological project, on closer inspection there is only one clear goal: to safeguard Europe’s prosperity at any cost. The intended role of the countries in the Global South in the ecological transformation in Europe is clear and unambiguous: they will continue to be reduced to the role of raw material suppliers. This will lead to deepening of environmentally and socially damaging extractive mining practices outside and potentially within EU borders while fuelling European industry growth and overconsumption in the Global North. Instead, we must strive for a sustainable and just transition within planetary boundaries and to guarantee the rights of southern countries to resource sovereignty, sustainable development and economic prosperity. This has to be a shared process to ensure decent living conditions for everyone everywhere. This being said, it is unacceptable that the CRMA promotes insufficient measures to prevent environmental damages and social conflicts.
Raw materials should only be traded to the extent necessary and fairly distributed globally. Only if the EU takes significant steps to adapt its policies in order to incentivize less consumption of energy, raw materials and natural resources, can we talk about a just ecological transition. This translates into a trade policy that incentivizes circular flows rather than pushing supplier countries into more damaging mining practices and reducing them to the role of supplier without their own value creation.
Reduction of raw material demand
The EU must reduce its demand for energy goods and raw materials. This will require a change in consumption and production and in our ways of living. Public policy will play a key role and thus the role of the States and the right to regulate must be preserved. Investments will be needed in areas such as public transportation. In order to be able to achieve the 1.5° target globally and to reduce and avoid the enormous environmental impacts and human rights violations associated with the extraction of raw materials, the absolute reduction of EU primary raw material demand with binding reduction targets and concrete measures for implementation must become the top priority and a central component of the CRMA. We need to enhance the circular economy, using less primary raw materials. Reusing and recycling raw materials is our first priority. We cannot simply consume our way to a cleaner, greener future.
Building international partnerships that have the needs of all in sight
Many EU member states bear high levels of responsibility for their historical contributions to carbon emissions and to climate change. The EU thus has a responsibility not only to ensure a socio ecologically just energy transition in the EU but also to support this transition in the Global South. This means that also the demand of raw materials for the Global South must be taken into account, not only the EU’s interest of security of supply. This requires global partnerships that involve local communities and a diversity of civil society actors. The core of any agreement to share and use resources must be based on local needs and the protection of their livelihoods – whether it is environmental or human rights protection, jobs and autonomy.
EU Trade policy has failed the people
It is the sovereign decision of every country to decide on the nature of its development, including whether to leave their raw materials in the ground, whether and how to extract them and to whom to sell them. EU trade policy has a poor track record in supporting the economic transformation of Southern countries: EU trade policy has undermined the economic transformation of Southern countries through a range of measures including premature liberalisation, tariff escalation which penalises value added processing and investment protection clauses. A sustainable and just transition needs to consider climate change and limited resources and trade policy should not be an obstacle for those countries who are committed to their climate goals and want to transition their economy.