European Commission Approves Critical Mineral Negotiating Directives
The European Commission said the EU Council will still have to approve negotiating instructions for a critical minerals agreement with the U.S. before formal negotiations can begin, but the Commission adopted those directives June 14, it announced.
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The priorities of the EU are trade facilitation, encouraging high environmental standards and promoting labor rights, with the end goal that critical raw minerals extracted or processed in the EU can qualify as critical minerals coming from a free trade partner.
The Republicans in the House of Representatives are moving in the opposite direction, with the Ways and Means Committee voting on a "Build it in America" bill late June 13 that reverses Japan's critical minerals agreement by saying that only countries with comprehensive trade agreements that liberalize "substantially all the trade" between countries can qualify for the critical minerals content thresholds under the Inflation Reduction Act.
The European Commission said it hopes to quickly conclude the agreement once the Council acts. The release said that last year, the EU exported 8.3 billion euros' worth of critical raw materials that are used in electric vehicle batteries.
"Concluding an EU-US CMA will ensure that as an ally, the EU is granted a status equivalent to US free trade agreement partners pursuant to the US Inflation Reduction Act. EU firms will then be able to compete on a level playing field with US and third country competitors on the US market, such as Chile, the Republic of Korea, and Japan," the release said.