The International Energy Agency (IEA) stated on Thursday that investments in critical metals declined last year, despite Western countries’ promises to boost domestic production for national security reasons.
In its report, the IEA highlighted that the geographical concentration of supply chains for critical elements necessary for high-tech industries, aviation, and clean energy has intensified, particularly in the processing sector. China and Indonesia, two leading countries in this field, accounted for over three-quarters of the total growth in processed material supplies over the past two years.
Despite efforts to diversify supply chains, geopolitical tensions and price fluctuations led to a 9% decrease in global investments in metal extraction and processing in 2025.
IEA Chief Economist Tim Gould remarked: “Over the past year, concerns about the high concentration of supplies have turned from a theoretical vulnerability into an immediate challenge for economic security.”
Export Restrictions and Threats to Production
The Paris-based agency, which advises energy-consuming countries, particularly emphasized the increasing introduction of export restrictions, viewing this as a source of economic and security challenges.
In its annual report titled “Global Prospects for Critical Metals,” the IEA noted that “restrictions on the export of rare earth metals introduced by China in April 2025 forced some automakers to reduce production or temporarily suspend operations.”
The agency added that if Beijing continues to implement its plans to expand export restrictions, it could threaten annual operations for further production outside China, valued at approximately 6.5 trillion dollars.
At the same time, the IEA noted positive developments, such as a more than fourfold increase in government financial commitments between 2023 and 2025.
Additionally, the United States and Malaysia have already begun to reduce China’s dominance in rare earth metal processing operations.
Source: Sky News Arabia
