Security of International Supply THE RAW MATERIALS INITIATIVE MEETING OUR CRITICAL NEEDS FOR GROWTH AND JOBS IN EU

1. 1 Security of International SupplyTHE RAW MATERIALS INITIATIVE � MEETING OUR CRITICAL NEEDS FOR GROWTH AND JOBS IN EUROPEA contribution for the way forwardC. Hebestreit

2. 2 Structure of the presentation Analysis of supply and demand of non-energy raw materials Competitiveness and economic growth Environmental protection Social cohesion The three recommendations hold true for the EU and the World The way forward Future development of the EU extractive industry is jeopardised by the constrains remaining in implementing current EU and national regulatory framework. Future development of the EU extractive industry is jeopardised by the constrains remaining in implementing current EU and national regulatory framework.

3. 3 1. Analysis of supply and demand of non-energy raw materials The supply situation in Europe ranging from self-sufficiency to high import dependence The imports are not necessarily produced at the same level of sustainability as in Europe If the competitiveness of the European downstream-industry is dependent on the access to cheaper and less sustainable resources, the sustainability agenda is jeopardised. EU self-sufficient in construction minerals; EU remains net importer of most industrial minerals; EU is highly dependent on imports of metallic minerals (domestic production limited to 3% of world production); EU relies heavily on secondary raw materials; EU highly dependent on imports of high-tech metals (such as cobalt, platinum, rare earths, and titanium); essential metals which play critical role in the development of innovative �environmental technologies�, for boosting energy efficiency and reducing GHG emissions. It is important for the EU not to miss the opportunity to make more of its domestic capacities.

4. 4 The three key questions on Resource Security: Geological availability Accessibility Sustainability

5. 5 Resource Security: Geological availability Geological availability is given, but Sometimes � according to our current knowledge - only in some countries; Sometimes we do not know what we have and we need more exploration; Sometimes we know, but we cannot get at it with current technology at competitive prices.

6. 6 Resource Security: Accessibility Accessibility is often not given, neither in Europe nor in other parts of the world: Land planning considering mineral deposits as valuable as other competing land uses Unhampered land access for exploration and extraction Competitive conditions for extraction and beneficiation of the minerals and metal ores Stable and legally reliable framework conditions Competitive investment conditions, such as tax regimes, permitting and closure conditions Competent authorities, professional and free of political affiliations Competitive and sustainable infrastructure conditions for transport Free, undistorted trading conditions

7. 7 Resource Security: Sustainability Sustainability is given in some parts of the world and not in others. It is not a question of Europe or non-Europe. Competitiveness and economic growth Environmental protection Social cohesion

8. 8 2. Competitiveness and economic growth EU Member States could increase their economic growth by extracting resources if the legal framework was appropriate. If we do not change the access to raw materials in Europe, more and more materials will be imported rather than produced in Europe even though they would be available. The economic down-turn will depress prices and hence increase imports.

9. 9 2. Competitiveness and economic growth Europe and its immediate neighbours have plenty of resources that are needed, but they need to be produced in a sustainable manner. Europe is not putting enough emphasis on the capacity building of its accession countries and its preferred partner states in order to ensure access to sustainable resources

10. 10 2. Competitiveness and economic growth Europe should complete its analysis of supply and demand for minerals and develop preferential relationship with those countries for which strategic resources have been identified. Then trade, development, environmental, capacity building and social policy aspects should be discussed where needed.

11. 11 10 Ferrous and Base Metals versus > 30 young metals10 Ferrous and Base Metals versus > 30 young metals

12. 12 Europe�s High-tech dependency

13. 13 3. Environmental protection Communication and application of BAT in extraction and mineral processing is an ongoing challenge in the EU 27 as it is for any neighbouring country that is exporting to the EU. Only total Life Cycle Assessments as well as cradle to gate assessments will show the true environmental burden of EU�s resources use in comparison to other parts of the world. Worldwide exchange and research on improved environmental performance of extraction and resource use will make the final goals more attainable.

14. 14 4. Social cohesion means  allowing resource rich countries to achieve growth through development of their resources, in Europe and outside! How about facilitating EU 12 to develop their growth and social cohesion through resources? They are resource rich countries with an experienced workforce that can learn new ways, but they need jobs.

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16. 16 4. Social cohesion  EU policies should also aim to empower developing countries. Must avoid �strangling� with one hand and giving �first aid� with the other.

17. 17 5. The three recommendations hold true for the EU and the World A. Strengthening developing countries: Use of EU development support funds for capacity building and infrastructure development. B. Promote a sound investment climate that helps increase supply: Clear legal and administrative framework. C. Promote sustainable management of raw materials Assisting partner countries in improving their social and environmental standards, improving human rights conditions, combating child labour.

18. 18 6. The way forward There is need for a decisive European response in order to ensure European competitiveness. Therefore, the issue of raw materials requires high level political attention and should be addressed in an integrated EU strategy that ties together various EU policies and promotes further cooperation between the Member States where appropriate.

19. 19 6. The way forward Identifying strategic resources for the EU By identifying demand for and the strategic nature of resources for each Member State; By adding the needs of the Member States and establishing an EU picture; By identifying potential countries of origin and assessing risk of access

20. 20 6. The way forward Extended dialogue on sustainable resource management with Bulgaria Romania Balkan countries And other preferred resource supplying countries At all levels: Government Industry NGOs

21. 21 6. The way forward Ensuring the level playing field and economic growth Removing trade distortions Implementing sustainable resource extraction and management through capacity building and cooperation projects Facilitating investment of European operators in developing countries

22. 22 �No person is an island� EU is and will remain a net consumer of resource with much of the supply coming from developing countries. Policy decisions in Europe have implications in the rest of the world. Only jointly will we meet the challenges of tomorrow�s world!