The Critical Minerals Front of European Rearmament
How the EU Critical Raw Materials Act is reshaping defence supply-chain resilience
Europe’s defence-industrial recovery will not be determined only by higher military budgets, new procurement programmes or the expansion of final assembly capacity. It will also depend on whether European and allied industry can secure the upstream materials that make advanced defence production possible: rare earths for permanent magnets, gallium and germanium for high-performance electronics, titanium for aerospace structures, tungsten for ammunition and kinetic systems, and a wider set of strategic inputs embedded in sensors, radar, missiles, drones, satellites, naval platforms and propulsion systems. The EU Critical Raw Materials Act has therefore become a defence-industrial instrument in substance, even if it was not designed as a defence regulation. Its central relevance lies in the attempt to reduce dependence on concentrated, and in several cases Chinese-dominated, processing and supply chains before the next material shock reaches Europe’s defence production base.
The report first examines the legal architecture of Regulation (EU) 2024/1252, correcting the common misconception that the 65% benchmark is a domestic production target rather than a maximum dependency threshold on a single third country. It then maps the defence relevance of the main strategic raw materials, analyses China’s leverage in processing, refining, separation, magnet production and export controls, and assesses the CRMA’s implementation tools, including Strategic Projects, demand aggregation, stockpiling and financing support. The second half connects the CRMA to EDIP, SAFE and European defence-industrial readiness, before turning to allied supply-chain architecture through the G7, EU-Australia partnership, Minerals Security Partnership, Quad framework and the US comparison with the Inflation Reduction Act and Defense Production Act Title III. The final section translates these findings into implications for defence primes, M&A advisers, private capital, banks, law firms, sovereign investors and public authorities.