MPs warn UK is dangerously reliant on China for critical minerals

A committee of MPs has found that the United Kingdom is “dangerously” dependent on China for the critical minerals it needs for defence, renewable energy and artificial intelligence, The Guardian reports. The business select committee wants the government to set up a central policy and a dedicated finance facility so the country can find other sources of supply.

What happened

The finding comes from a parliamentary investigation by the House of Commons business select committee. According to The Guardian, MPs called for an urgent, centralised policy and a “critical minerals finance facility” to help fund rare earth and other critical mineral mines. The facility would use grants, equity and debt to speed up a programme to diversify supply away from China.

The committee’s chair, Liam Byrne, said: “Critical minerals are the alpha of the new economy. We cannot rearm Britain, build AI or deliver net zero unless we secure the minerals these technologies depend on.” He added that “16 years after China first weaponised its chokehold over rare earths, Britain remains dangerously exposed.” The Guardian notes that this is the second time in a week that Byrne’s committee has criticised the government’s China policy.

The committee heard that the bottleneck sits in processing rather than mining. China dominates the refining of seven categories of minerals. These include refined lithium, needed for electric vehicles, and rare earths used in the fuselage and wings of military aircraft to help them withstand extreme temperatures.

Demand is set to rise sharply. MPs were told that demand for lithium alone would increase 45-fold between now and 2030. Demand for the rare earths used in permanent magnets, including those in military jets, is expected to rise 16-fold over the same period, just as Britain is trying to rebuild its military capabilities.

The committee pointed to recent disruption. China suddenly cut off rare earth supplies in 2025. Separate restrictions on legacy chips, which followed a row over a Dutch intervention in the China-owned firm Nexperia, left the European car industry “days away” from stoppages last October. Donald Trump secured a one-year reprieve on Chinese export restrictions on rare earths from Xi Jinping in October last year, and this has since been extended to January 2027. The report suggests this leaves the UK at the mercy of relations between the US and China.

MPs also complained about a lack of transparency. “Parliament has no visibility of the capabilities the government is seeking to protect, the vulnerabilities it has identified, or the projects it is backing to reduce risk,” the committee said. It set out a 10-point plan and said it could not be confident that the government could meet any of its 10 tests.

A government spokesperson rejected the claim that ministers lack a strategy. They said the government was delivering £400m “to ramp up domestic production and recycling” and building new international partnerships. The strategy, they said, sets goals for 2035: meeting 10% of demand through domestic production and 20% through recycling, with no more than 60% of any critical mineral coming from a single country.

Why it matters if you live in United Kingdom

These minerals are not only a concern for defence planners. The Guardian notes that rare earths and their refined byproducts are used in car-locking systems and in household goods such as fridges and washing machines. Lithium is central to electric vehicles. Any sudden cut in supply could affect the products people buy every day, although the report does not put a figure on price rises or shortages.

The report also links mineral supply to three national priorities that affect residents directly:

• Defence: MPs say Britain cannot rearm without secure access to rare earths used in military aircraft.
• AI: the committee lists AI among the technologies that depend on these materials, at a time when the UK is trying to build its AI capacity.
• Net zero: renewable energy infrastructure and electric vehicles rely on the same supply chains, so the transition could be put at risk.

For workers, the Nexperia episode shows how quickly a dispute far from home can threaten production lines. The European car industry came close to stopping last October because of chip restrictions alone. The committee’s plan also looks at domestic mining, refining and recycling, and at whether planning and permitting rules are getting in the way of new mines, which could matter for communities near possible sites.

What to watch next

The clearest date is January 2027, when the extended US-China reprieve on rare earth export restrictions is due to end. What happens then will shape how exposed the UK remains, according to the committee’s reasoning.

Watch, too, for the government’s formal response to the 10-point plan. The committee wants ministers to identify domestic mining, refining and recycling opportunities and their costs, to encourage businesses to buy less from China, to unlock investment and to review planning barriers. It also argues that the most realistic route is to work with G7 partners, the rest of Europe and Indo-Pacific countries to “aggregate demand” and bring in new suppliers.

The government says its £400m programme and its 2035 targets already answer these concerns. MPs clearly disagree. “The UK requires new institutional and financial muscle,” the committee concluded. Whether ministers create the finance facility it proposes will show how seriously they take that warning. For more coverage of AI and technology policy, visit Mylistingo.

Source: The Guardian