Korea to cut dependence on China for key minerals

The Korea Times

The Korea Times

Business

Wed, November 29, 2023 | 03:55

Korea to cut dependence on China for key minerals

Posted : 2023-02-27 16:51

Updated : 2023-02-28 16:09

Minister of Trade, Industry and Energy Lee Chang-yang / Korea Times file

By Lee Kyung-min

Korea will reduce its dependence on China for imports of key minerals to 50 percent by 2030, down from the current 80 percent, the industry ministry said Monday.

The country relies on imports to meet over 95 percent of its key mineral needs, including lithium, nickel, cobalt and graphite that are critical to maintaining the competitiveness of the country's high-tech industries, such as semiconductors and electric vehicles (EV). Up to 20 percent of the essential minerals will be recycled over the next seven years, compared to 2 percent at present.

These are measures announced by the Ministry of Trade, Industry and Energy to help fortify the stability of local mineral supply chains, as part of a vision to turn the country into a high-tech global industrial powerhouse.

Minister of Trade, Industry and Energy Lee Chang-yang said the drive is vital to securing the sustainable growth of Korea's industries, increasingly challenged by a slew of uncertainties in the global energy market.

"Competition over stable mineral supply chains is becoming fiercer among global players, as sustained by only a handful of resource-rich countries having the capabilities to produce and mine the high-value materials that are high in demand," he said at a meeting attended by representatives of the country's EV, rechargeable battery and resource mining and development industries, Monday.

A total of 10 out of 33 government-designated core minerals will be closely monitored for timely supply and demand.

Among the 10 minerals are lithium, nickel, cobalt, manganese, graphite and rare earths, all of which could cause Korea's chip and EV manufacturing industries to suffer catastrophic export declines in the event of supply disruptions.

The government will develop a global mine map and establish an early warning system to better prepare against mineral supply chain risks.

The core minerals will be stored in reserves for at least 100 days, up from the current 54 days. A preliminary feasibility study will be commissioned to build mineral storage facilities. An emergency government order will warrant the prompt supply of minerals needed by local firms no later than 8 days after a request is filed.

Korea will also foster diplomatic relations with resource-rich countries, buttressed by memorandums of understanding (MOUs) and greater opportunities for local firms to enter their markets for resource development projects.

Recycling efforts will be promoted through partnerships between private and public-sector businesses to accelerate technological developments and swift commercialization.

Private firms participating in the sustainable circulation system will be granted greater financing opportunities and tax credits expanded to foster contributions to develop key growth driver technologies and promote economic growth.

The government will establish a legal framework to further support the growth of mineral industries, anchored by continued investments in training skilled workers and other efforts.

lkm@koreatimes.co.kr