UK MPs warn of 'dangerous' China reliance on critical minerals for AI

A parliamentary investigation by MPs on the business select committee concluded that the UK relies to a dangerous degree on China for the critical raw materials that the military, renewable energy and AI depend on, according to a news report. The committee wants a centralised policy without delay, plus a critical minerals finance facility that would back rare earth and other mines through grants, equity and debt to hasten diversification. Chair Liam Byrne said Britain cannot rearm, build AI or deliver net zero without securing the minerals these depend on.

The committee heard that bottlenecks lie in processing, where China dominates refining across seven categories of minerals. Demand for lithium is expected to grow 45-fold between 2024 and 2030, and demand for rare earths used in permanent magnets 16-fold. The report notes that China cut off rare earth supplies in 2025, and that restrictions on legacy chips after a dispute over Nexperia left European carmakers days from stoppages last October. A one-year reprieve on Chinese export restrictions secured by Donald Trump has been extended to January 2027, which the report says leaves the UK exposed to US-China relations.

The committee called working with G7 partners, Europe and Indo-Pacific countries to pool demand the most realistic solution. It criticised a lack of government transparency and set out a 10-point plan covering domestic mining, refining and recycling, reduced procurement from China, investment and planning barriers. It added that it lacks confidence the government can satisfy any of its 10 tests. A government spokesperson denied there is no strategy, citing 400 million pounds and goals for 2035 of 10% domestic production, 20% recycling and no more than 60% from one country.