Only commodities promise security – does Europe lack the courage to invest?
“No Rearmament Without Raw Materials,” the Zurich newspaper recently headlined. Even if most people are not in favor of war, complete defenselessness in the face of escalating geopolitical conflicts does not inspire confidence. Certainly, with 500 billion Euros, one could purchase a great many tanks, drones, and chips to control them. But what if the supply simply isn’t there?
Germany's financial windfall – but where are the commodities?
Friedrich Merz’s special fund of 500 billion euros covers both infrastructure and defense. However, there is no mention of commodities or their procurement. Yet, money alone cannot load a rifle. The EU is also aware of this, having introduced the Critical Raw Materials Act (CRMA) in March 2023. This is intended to strengthen the European supply of critical commodities and reduce dependence on China and other third countries.
As part of this strategy, the European Investment Bank (EIB) launched an initiative on March 21, 2025, to provide 2 billion euros for commodity projects. In addition, there is Robert Habeck’s commodity fund, which provides a further 1 billion euros via the KfW Bank. Two small steps in the right direction – but by no means enough.
2% Instead of Billions in Investment – Europe's Investment Gap
At the premiere of their book “The Cocaine of Industry,” authors Andreas Kroll and Andreas Pietsch put it in a nutshell: “A blank check for the defense industry is not possible without a blank check for commodities.” But here we are not talking about 1 to 3 billion euros, but at least 100 billion euros if Europe wants to keep up with the USA and China.
Why this figure? Because Europe currently accounts for just 2% of global commodity investments. We have a lot of catching up to do. And this becomes all the more urgent when you consider that 98% of refined gallium and a similar percentage of refined rare earth products such as dysprosium oxide and metal still come from China.
Europe's Raw Material Strategy: A Lack of Consistency
While Germany has not had a mining exploration company for decades, other countries are using their resources strategically: Russia uses commodities as geopolitical weapons, controls areas in Ukraine with significant commodity deposits, and trades with the USA. The latter, in turn, prioritizes its own commodity security – with or without Europe.
Although the EU has launched the Critical Raw Materials Act, the European Raw Materials Alliance (ERMA), and national initiatives such as the German commodity fund, all of this often remains piecemeal. What is missing is a decisive, coordinated approach with serious investments.
Tapping into New Raw Material Sources – Diversification as the Key to Independence
“What is needed is courage!” – this sentence by Andreas Kroll and Andreas Pietsch also points in the right direction. Towards new raw material sources such as the monazite mine in Steenkampskraal, South Africa, which we are supporting. The rare earths extracted there could become a decisive building block in freeing Europe from its raw material impotence.
Europe’s strength lies not only in money, but in the willingness to invest it in a targeted and clever way. Without commodities, neither rearmament nor the energy transition will succeed. The question is: Do we have the courage to act now?