How the battle for rare minerals entered the Ukrainian battlefield

The United States is playing superpower games when it comes to rare minerals, especially against China. However, this need for technological advancement and a new form of "space" race is influencing other decisions in Washington – particularly on the issue of the war in Ukraine.

The reason for the friction between Washington and Beijing is the quest for dominance in the artificial intelligence sector. Microsoft founder Bill Gates recently made comments about climate measures that shocked some of the world's media, but in the context of AI and the need for cheap energy to "feed" it, it was an understandable move.

"Although climate change will have serious consequences, especially for people in the poorest countries, it will not lead to the extinction of humanity," wrote the billionaire on his blog at the end of October, adding that people "will live and prosper in most places on Earth in the foreseeable future."

"Unfortunately, the catastrophic view [of climate change] causes much of the climate community to focus too much on short-term emission targets, which diverts resources from the most effective measures we should be taking to improve life in a warming world," he admitted, later adding that governments must focus on raising living standards—including through cheap energy.

The cards are dealt, the deposits are divided

The world's largest deposits of these metals – which are used in everything from magnets to chips, lasers, GPS devices, and smartphones – are located in China. According to current geological estimates, there are approximately 44 million tons of extractable rare metals in the country of the dragon.

The ranking of countries by quantity is followed by Vietnam (22 million tons), Brazil (21 million tons), Russia (12 million tons), India (6.9 million tons), Australia (5.7 million tons), the USA (1.9 million tons), and Greenland (1.5 million tons).

China also leads in terms of processing and production, covering 90 percent of global demand in 2019. However, since 2010, the communist government has imposed several export restrictions, tightening them in 2018 as a result of the so-called trade war with the US.

After Donald Trump's second inauguration earlier this year, the US and China escalated mutual tariffs to 125 to 145 percent of the value of imports. Currently, their validity is suspended, but Xi Jinping's government tightened export controls on five elements in this category ahead of negotiations with Trump.

At their October meeting, the leaders of the superpowers agreed not only on the transfer of the TikTok platform but also on the relaxation of restrictions on chip exports. The Dutch company Nexperia, which is owned by Chinese capital and accounts for approximately 70 percent of exports, resumed deliveries to global markets, and Trump, in return, reduced the tariffs on Chinese imports.

On November 9, the Chinese Ministry of Commerce revoked the export control regulation on gallium, germanium, antimony, and tungsten, although this measure is only valid for one year.

Deposits in Donbas

Eastern Ukraine, the region where fighting has been raging since February 2022, is home to massive deposits of graphite, lithium, and titanium. Since February of this year, negotiations have been underway on a joint investment venture for the extraction of oil, gas, and rare earths in the Donetsk and Luhansk regions, which would receive revenues from the trade in these commodities.

Donald Trump and Ukrainian President Volodymyr Zelensky had an argument in the Oval Office on February 24, which was the result of a mutual misunderstanding – Kyiv was counting on unlimited supplies of American aid, while Trump's White House was hoping for some return on the support it had provided so far.

In the end, however, the framework agreement reached its final stage, and US Treasury Secretary Scott Bessent and then-Economy Minister (now Prime Minister) Yulia Svyrydenkova signed the document. Zelensky's (or Shmyhal's) cabinet apparently understood that having US business interests on its territory is a de facto security guarantee.

A good example of this Anglo-Saxon perception of the world is Kuwait. The Persian Gulf country has been home to the British oil company British Petroleum (now BP), the Iranian-American Chevron, and the Arab-American Saudi Aramco since the 1930s.

When Kuwait annexed neighboring Iraq under the rule of Abd al-Karim Qasim in 1961, London sent its navy to defend the so-called "nineteenth province," as Kuwait was called in Baghdad. The Anglo-American "coalition of the willing" also defended the coastal emirate at the turn of the century, culminating in the last war in Iraq (2003).

Trump thus secretly offered Zelensky security guarantees under the guise of economic agreements. However, the American gain from this agreement is part of a larger framework of hostility between the superpowers.

Potentially retaining Donbas would secure the United States' supply of rare metals for the artificial intelligence race with China—and the war in Ukraine and tensions over Taiwan would once again converge. This would fulfill the definition of a "fragmented" Third World War, as explained by the late Pope Francis.