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The Diplomat
4 days ago
- Business
- The Diplomat
Operationalizing a Quad Critical Minerals Pact
As American economic leadership in the Indo-Pacific faces its most difficult litmus test in years, a Quad critical minerals partnership offers the most promising — and practical — first step to restore trust and deliver results. With just six months into the new administration, the Biden-Trump transition has unleashed a new era of unpredictability in U.S. economic diplomacy, particularly with America's closest Indo-Pacific allies. Yet amid a patchwork of frayed trade ties and ongoing negotiations, there is potential for a more constructive path forward. The July 1 meeting of Quad foreign ministers from the U.S., Japan, Australia, and India — the second since President Donald Trump's return to office — offered an opening to rebuild trust and deliver tangible economic benefits to all Quad members. The ripest opportunity on the table is a formal Quad partnership on critical minerals. The Quad Critical Minerals Initiative, announced in a joint statement following the recent Quad ministerial meeting, is a step in the right direction, albeit lacking in details. The greatest challenge, however, is not just adding meat to the Critical Minerals Initiative. It is traversing an already complex interplay of national interests along with the added complexity of President Trump's trade policy, and a 'negotiating new terms' of sorts with long-term partner countries. A Strenuous Moment between Quad Nations and Washington U.S. Secretary of State Marco Rubio urged his counterparts from Japan, India, and Australia to elevate the grouping's coordination function toward delivering concrete projects, one of which is diversifying the global supply chain of critical minerals. His message was pointed: securing not just access to raw materials, but the capacity to process and refine them, is a shared strategic imperative for all four nations. This push comes at a particularly strained moment for U.S. relationships with its closest allies in the Indo-Pacific. The Trump administration's unilateral tariffs have damaged relationships with each Quad partner. Japan faces looming reciprocal tariffs, with trade talks stalled and the president publicly criticizing Japan's 'spoiled' trading practices. Australia is awaiting the results of a Pentagon-led review of AUKUS, the major trilateral security pact between Canberra, Washington, and London. Meanwhile, U.S.-India relations have chilled as Delhi expressed frustration over Washington's outreach to Pakistan when India-Pakistan relations hit their lowest point in recent years due to ongoing military and diplomatic assaults from both sides. In short, critical minerals aren't the only things in short supply — trust and goodwill between the U.S. and its partners are scarce too. Why Critical Minerals, Why Now? Despite tensions, there is one area where the interests of all four nations align: securing access to the critical minerals that underpin everything from the green energy transition to cutting-edge defense systems. China's willingness to weaponize its dominance in the critical minerals supply chain, in particular, and its economic coercion practices, in general, is no breaking news. In 2010, Beijing cut off rare earth exports to Japan after an incident in a disputed territory, setting off an alarm in Tokyo to reduce dependency. Japan's reliance on Chinese rare earths, once over 90 percent, has since fallen below 60 percent, which is a significant improvement but still presents a weak point that China can exploit. In April 2025, China sharply escalated tensions by imposing stringent export controls on several critical minerals and rare earth elements — including samarium, scandium, and dysprosium — essential to advanced defense systems, electric vehicles, and renewable energy technology. The move, justified by Beijing on national security grounds, effectively throttled global supplies, causing immediate disruptions. The United States faced acute impacts, particularly in defense manufacturing and semiconductors, sectors heavily reliant on Chinese-processed rare earth magnets. India's and Japan's electronics and automobile industries were thrown into crisis, warning of imminent factory shutdowns due to delayed magnet shipments. Beijing's April clampdown has sent shockwaves across global supply chains and sharply highlighted vulnerabilities among Quad nations. Recognizing the urgency, the U.S., India, Japan, and Australia have increasingly viewed the Quad as the natural platform to build a resilient supply chain, which eventually led to the new joint initiative to develop extraction, processing, and refining capabilities. Beyond Intent: What a Real Pact Should Look Like Rubio said that after the ministerial meeting, nearly 40 companies from all four countries also convened to explore areas of cooperation. But industry alone cannot bridge this gap on its own. Congress should act to pass the Quad Critical Minerals Partnership Act sponsored by Sen. Lankford, James (R-OK), which would require the administration to develop a strategy to secure supplies with trusted partners and direct agencies to prioritize investment and collaboration with Quad members. Each Quad nation brings distinct strengths. Australia offers both raw materials and world-class extraction and processing know-how. Japan's hard-earned experience in public-private investment is a model for the group. India has both the ambition and reserves to emerge as a hub for processing and refining. The U.S. provides capital and market access. Together, the four can add teeth to the Critical Minerals Initiative by developing a joint fund to identify and get projects off the ground. In addition to the long-term solution of building an alternative supply chain from Beijing, the four nations can also remedy the bottleneck in the short term by coordinating and sharing their stockpiles of rare earths. India's recent move to restrict its exports of rare earths to Japan highlights how Beijing's export controls are damaging economic ties in other bilateral relationships within the Quad. This development not only hinders future collaborations but also worsens the ongoing shortages, warranting an immediate joint effort to pool resources together rather than imposing further restrictions. Critical minerals security remains a rare issue of bipartisan consensus in Washington. As American economic leadership in the Indo-Pacific faces its most difficult litmus test in years, a Quad critical minerals partnership offers the most promising — and practical — first step to restore trust and deliver results.
Japan Times
02-07-2025
- Business
- Japan Times
‘Quad' nations announce critical minerals initiative amid China concerns
Top diplomats from 'the Quad' nations of Australia, India, Japan and the United States have agreed to work more closely to secure supply chains for critical minerals, including rare earths — a sector dominated by China — in a bid to cut back their reliance on Beijing. In a joint statement released after a summit hosted by U.S. Secretary of State Marco Rubio in Washington on Tuesday, the four Indo-Pacific countries announced the launching of the Quad Critical Minerals Initiative, which they called 'an ambitious expansion' of the partnership that will 'strengthen economic security and collective resilience by collaborating to secure and diversify critical minerals supply chains.' Rubio said the plans would allow 'not just access to the raw material but also access to the ability to process and refine it to usable material.' 'It's critical for all technologies and for all industries across the board,' he said. 'So having a diverse and reliable global supply chain of these is just one example of many that we can focus on and build upon and achieve some real progress on.' According to a fact sheet outlining this and other measures from the meeting, the new critical minerals tie-up aims to strengthen cooperation on 'securing and diversifying reliable supply chains, and electronic waste (e-waste) critical minerals recovery and re-processing.' Quad members are also planning to coordinate with private sector partners 'to facilitate increased investments.' Quad nations share concerns over China's virtual monopoly on a number of key minerals, including rare earths crucial for electric vehicles, drones and semiconductors, as well as for weapons such as fighter jets and missiles. According to the International Energy Agency, China is estimated to account for about 62% of global rare earth production and 92% of their processing. Highlighting the Quad's concerns, Beijing recently sought to use restrictions on the minerals as leverage in the U.S.-China trade war, a lesson the Asian behemoth also foisted upon Tokyo in 2010 following a maritime clash near the Japanese-controlled, Chinese-claimed Senkaku Islands. While there were few other details on the new initiative, the four countries made it clear during the meeting that one goal was to reduce their dependence on Beijing. 'We are deeply concerned about the abrupt constriction and future reliability of key supply chains, specifically for critical includes the use of non-market policies and practices for critical minerals, certain derivative products, and mineral processing technology,' top Quad diplomats said in a joint statement carefully crafted not to directly mention China. 'Reliance on any one country for processing and refining critical minerals and derivative goods production exposes our industries to economic coercion, price manipulation, and supply chain disruptions, which further harms our economic and national security,' it added. Japanese Foreign Minister Takeshi Iwaya speaks during a meeting of top diplomats from "the Quad," as Indian External Affairs Minister Subrahmanyam Jaishankar (left), Australian Foreign Minister Penny Wong (second left) and U.S. Secretary of State Marco Rubio stand together at the start of talks at the State Department in Washington on Tuesday. | REUTERS In welcoming his Quad counterparts, Rubio touted the grouping as a 'very important partnership,' but urged more 'concrete actions' on key issues. This, however, could prove to be a challenge. All three U.S. partners in the Quad — including allies Japan and Australia — are grappling with how best to respond to President Donald Trump's onerous tariff campaign. Those trade moves, as well as Trump's perceived lack of focus on the Indo-Pacific region, have unnerved Quad leaders. The Trump administration has also triggered unease in Tokyo and Canberra with its demands that both countries ramp up defense spending. Washington has also raised eyebrows about its regional commitment by announcing a review of its AUKUS security partnership with Australia and Britain. Trump has singled out competition with China as a key focus of his administration, but, in the first six months of his presidency, domestic rows, conflicts in Ukraine and the Middle East and rising trade tensions have consumed much of its attention. Asked about Washington's stance on the Indo-Pacific, Foreign Minister Takeshi Iwaya said the U.S. is 'unwavering' in its commitment to the region, pointing to Rubio's move to hold a first meeting of the Quad foreign affairs chiefs just an hour after being sworn into office in January. 'By holding this meeting again in person ... we were able to demonstrate to the international community the strength and importance of the Quad,' Iwaya said, adding that the meeting 'laid the groundwork for the success of this year's Quad leaders' summit.' The meeting did see the U.S. stand by long-held positions on a number of regional concerns — at least on paper. In their joint statement, the four countries reiterated boilerplate language, voicing "serious concerns regarding dangerous and provocative actions" in the South and East China seas that they said "threaten peace and stability in the region." They also reiterated a 'steadfast commitment to a free and open Indo-Pacific' and 'defending the rule of law, sovereignty, and territorial integrity,' while pledging to 'strongly oppose any unilateral actions that seek to change the status quo by force or coercion.' In a win for Japan, the four also condemned North Korea's missile and nuclear weapons program, reaffirming their commitment to the 'complete denuclearization of the Korean Peninsula' and cooperation on 'the immediate resolution' of the issue of Japanese nationals abducted by North Korean agents in the 1970s and 1980s, according to the Foreign Ministry in Tokyo. A Quad leaders' summit is scheduled to be held later this year in India, while Australia will host the grouping's next meeting of top diplomats in 2026.
