Canada Launches $6.4B G7 Critical Minerals Initiative to Reduce China Reliance

Canada has launched a significant initiative backed by the G7 to boost its critical minerals sector, aiming to reduce Western dependence on China's dominance in this market. The government announced C$1.4 billion in investments and partnerships supporting 26 projects, including mining and processing operations across the country, with notable funding to companies like Rio Tinto and Ucore Rare Metals. These critical minerals are essential for clean energy, defense, aerospace, and advanced manufacturing, and the move is framed as a national security priority under Canada's Defence Production Act, guaranteeing buyers and minimum prices to support the industry. Energy Minister Tim Hodgson emphasized the geopolitical importance, highlighting the need to create supply chain resilience amid China's control of about 70% of key minerals and 91% of rare earth refining globally. Despite a temporary easing of some Chinese export controls following a U.S.-China deal, G7 countries stress the urgency of establishing independent supply chains for these vital materials to safeguard economic and national security interests. Industry leaders warn that without such interventions, Chinese pricing strategies could undermine new mining projects, making Canada's government support crucial for developing a competitive domestic critical minerals sector.