China’s Raw Materials Diplomacy and Governance Cycle: Toward Sustainable Mining and Resource Extraction?

Abstract

China’s raw materials diplomacy and unregulated purchasing of minerals in Africa and Latin America, as well as its domestic raw materials export quota, have for years been eyed with suspicion by state and private actors. Industrialized countries want to uphold and extend free market access to raw materials, but also strengthen their political accountability and sustainability. However, critics argue that in contrast, China, the world’s largest metals and minerals trading power, has taken the opposite course, ignoring social and environmental standards, reinforcing authoritarian governments, and erecting trade barriers. China is faced with several interrelated challenges in its resource diplomacy and governance. This article claims that an identifiable, chronological connection and pattern has existed between China’s aid and investment diplomacy for resources since the late 1990s, free trade agreements since the 2000s, Beijing’s resource nationalism since the 2010s, and the reform process of national and privately organized transnational governance toward sustainability in the present day. Is China socializing with emerging transnational standards on mining and resource extraction in the developing world, and if so, why? This article argues that China’s raw materials governance, including corporate governance, has entered a phase of reform to pacify the external environment and to implement the Belt and Road Initiative. In theoretical terms, China’s raw materials governance will continue to emphasize neoliberal and neo-mercantilist goals, cushioned by globalist features.

The Revised German Raw Materials Strategy in the Light of Global Political and Market Developments

“…Instead, other countries have been more effective in gaining access to raw material production than Germany. Japan has continued to get access to promising mining projects of some of the most critical raw materials (Schmid, 2019a) and China is—maybe more than ever—engaged in Mongolia, Kazakhstan, and Peru (Biedermann, 2018; Chen & Fazilov, 2018; Müller, 2019). In order to critically reflect on the revised German raw materials strategy, how holistic and ambitious it actually is and to identify further policy options, a comparison with the raw materials strategies of other leading industrialized nations is consequently helpful.…”

“…In recent years, few scholars have analyzed political raw materials strategies worldwide. Their studies compared policies in different world regions (Barteková & Kemp, 2016), policies on strategic and critical raw materials in China (Andersson, 2020;Biedermann, 2018;Shen, Moomy, & Eggert, 2020), the competition for raw materials of certain countries (Gulley et al, 2018;Schmid, 2019a;Vekasi, 2019), and policy measures with regard to certain CRMs, especially rare earths (Mancheri, Sprecher, Bailey, Ge, & Tukker, 2019;Wübbeke, 2013). Furthermore, some scholars focused on the analysis of corporate raw material strategies, which are often intertwined with national policies (Lapko, Trucco, & Nuur, 2016;Schmid, 2020aSchmid, , 2020b.…”

“…China took the lead years before and has become a dominant producer, refiner, and importer of many CRMs (DERA, 2019;Rabe et al, 2017). Not only has the country developed its domestic raw material industry, but has also secured supply through investments in many CRM projects worldwide, including the production of some of the most critical raw materials like rare earths (Biedermann, 2014(Biedermann, , 2018Schmid, 2019a;Zeuthen, 2017). Based on its strong position in upstream industries, China has increasingly strengthened its downstream industries and aims to become a technology leader in key industries (Wübbeke et al, 2016).…”

Electric batteries and critical materials dependency: a geopolitical analysis of the USA and the European Union

“…Rare earths in China were declared "protected and strategic materials" as early as 2003. At the same time, China began to deploy economic diplomacy to support its "going out strategy" adopted in 1999 (Abeliansky & Martínez-Zarzoso, 2019) and to guarantee Chinese companies' access to raw materials in Africa and Latin America (Biedermann, 2018). China has multiplied free trade agreements, loans, donations, and investments in developing countries in exchange for deliveries of raw materials.…”

“…Meanwhile, China strengthened its economic diplomacy to ensure growing imports of critical materials. It was subsumed in the "Belt and Road Initiative" in 2013 (Biedermann, 2018), with up to 8 trillion US dollars of loans and investments in infrastructure, energy and telecommunication that will boost its imports of raw materials and exports of manufactured goods and services (Jetin, 2018). The BRI enabled China to extend a "web of global partnerships" (Kalantzakos, 2020) which includes 146 countries in 2022 that host a large number of Chinese companies.…”