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Chinese Critical Mineral Investment Has Exploded Since Biden Signed Landmark Climate Bill

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China has seen a huge increase in investment related to critical minerals essential for sourcing green energy products since President Joe Biden signed his signature climate bill in 2022, according to a recent analysis published by Australia’s Griffith University.

By way of the Chinese Communist Party’s (CCP) “Belt and Road Initiative” (BRI), Chinese entities in 2023 massively stepped up their investments in mining minerals like lithium, copper and nickel, all of which are essential for manufacturing products like the lithium-ion batteries that power electric vehicles (EV), according to the Griffith Asia Institute’s report. Last year’s totals for BRI mining investment grew by 158% relative to 2022, and the Griffith Asia Institute projects more growth in BRI investment targeting green energy, mining and related activities through the rest of 2024.

The BRI is a CCP-backed program that aims to build out a massive network of infrastructure projects and developments that reach around the world, according to the Council on Foreign Relations. Critics have asserted that BRI investments and construction contracts double as a mechanism for China to lay debt traps for developing countries that can later give the CCP significant leverage over those governments.

Biden signed the Inflation Reduction Act (IRA) into law in August 2022, promising that the law’s allotment of $369 billion for green energy-related subsidies would make the American economy cleaner while spurring a resurgence in American manufacturing driven by mass-production of products like solar panels and EVs. Many of the bill’s criticspointed out that China’s dominance of supply chains for the raw materials needed to manufacture these products could lead to Chinese entities capturing the value of taxpayer-funded green energy subsidies or otherwise benefiting from the legislation.

In the first full year after Biden signed the law, Chinese entities invested more than $19 billion in mining-related projects, with about $15 billion of that investment poured into mining nickel, lithium, copper and aluminum, according to the Griffith Asia Institute. In 2021, the last full year before the IRA became law, total BRI investment in mining did not exceed $10 billion.

Numerous reports have emerged indicating that Chinese entities are looking to cash in on the IRA’s provisions purportedly designed first and foremost to benefit American enterprise. To access IRA loopholes, Chinese entities are maneuvering to access U.S. subsidies by establishing operations in places like Morocco, an American ally that is notexcluded from benefiting from the bill, while other Chinese companies are positioning themselves to cash in by opening up shop in the U.S. using joint ventures or subsidiaries.

U.S. companies have also made many substantial investments in green energy initiatives with the help of the IRA’s robust subsidies. Since Biden took office, the private sector has poured more than $360 billion into green energy-related investments, according to the White House.

“I’m not — we’re not looking to hurt China, sincerely,” Biden said during a September 10, 2023 speech in Vietnam. “We’re all better off if China does well — if China does well by the international rules. It grows the economy … we’re not looking to decouple from China.”

Nevertheless, there is some level of apprehension within the administration about Chinese green energy products. Beyond concerns about Uyghur Muslim slave labor’s alleged links to Chinese green supply chains that have persisted for years, the administration announced Thursday that it is probing certain types of Chinese EVs perceived to pose potential national security and intelligence risks.

“China is determined to dominate the future of the auto market, including by using unfair practices,’’ Biden said in a Thursday statement. “China’s policies could flood our market with its vehicles, posing risks to our national security. I’m not going to let that happen on my watch.”

The White House did not respond immediately to a request for comment.

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