Jamieson Greer Calls For 'National Security Premium' On Critical Minerals To Counter China's Dominance As Allies Fear Retaliation

U.S. trade representative Jamieson Greer has proposed that allies pay a premium on minerals sourced from a proposed group of reliable trading partners, including Europe, to break China’s dominance. Greer, in an interview with the Financial Times on Wednesday, attributed the Western reliance on China for key minerals to countries’ fixation on business costs. In February, the U.S. proposed a bloc of countries that would trade critical minerals among themselves at agreed floor prices, ensuring mining and processing projects remain profitable and attractive for investment while reducing reliance on China-dominated supply chains. To enforce this framework, the plan could involve imposing tariffs or other trade barriers on minerals from outside the group, particularly from China, to prevent low-cost producers from undercutting prices and discouraging Western investment “There is a premium we pay, and I call it the national security premium, and we will all pay a national security premium to have a secure supply chain,” Greer, who is involved in drafting details of the plan, told the FT. The proposal, however, has raised concerns among allies about higher costs and potential retaliation from China, underscoring the difficulty of countering Beijing's entrenched dominance amid rising energy costs and inflation. Some of the allies are also concerned that mineral protections could raise costs for defense, autos, and clean energy, while also risking retaliation from China, reported FT. That being said, U.S. allies like the EU and Japan signaled support for a joint critical minerals trade initiative, potentially using coordinated price floors, subsidies, and purchase agreements. Read Also: Jamieson Greer Signals No Return To 'Zero-Tariff Trade' For Mexico Despite Upcoming USMCA Renegotiation: Report China Mineral Push Sparks US Response China’s overseas market expansion, with over $120 billion invested in critical minerals projects worldwide since 2023, is rapidly reshaping the global supply chain, according to a report by Climate Energy Finance (CEF). This has raised concerns about Western competitiveness, and the control over these minerals is increasingly viewed through the lens of national security and military competition. Securing rare earths and critical minerals has become a top Trump administration priority after China restricted exports. Earlier this year, the Trump administration launched Project Vault, a $12 billion public-private initiative aimed at insulating the U.S. economy from global resource volatility and reducing reliance on Chinese mineral supply chains. Meanwhile, last week, Sprott Asset Management launched the Rare Earths Ex-China ETF (NASDAQ:REXC), offering exposure to companies involved in the mining, refining and production of rare earth elements outside China. Sprott said the ETF tracks the Nasdaq Sprott Rare Earths Ex-China Index, excluding China, targeting companies poised to benefit from policy support and rising demand. Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors. Image via Shutterstock Read Also: Apple, Amazon, Others Not Seeking Tariff Refunds To Avoid Offending Trump? The President Says He'll 'Remember' Them