High commodity prices are now becoming the norm, with constrained supply compounding the pressure exerted by increasing demand. One result is increasing politicisation. Already, industrial, emerging and developing economies are vying for supplies; something worse – a scramble for resources – is possible.
In the minerals sector, for example, the US, the EU and Mexico have taken a case to the World Trade Organization (WTO) against China about nine minerals; the EU is flirting with the idea of making its development aid conditional upon access to crucial minerals, particularly metals; China is restricting exports of its much-coveted rare-earth elements; and Brazil is considering doing the same.
Such competition affects many resources, but there should be particular concern about metals and other important minerals.
For some other major resources, international systems and structures exist. The energy industry has – for example – the International Energy Agency, the (European) Energy Community, the International Energy Forum and OPEC. Concerns about food supply can be addressed through, for example, the UN’s Food and Agriculture Organization, the International Fund for Agricultural Development and the World Food Programme.
For industrial minerals and metals, there is nothing comparable. Some, but not all, are discussed in separate international organisations; the membership of all of them is limited and varied. All are flawed.
The Organisation for Economic Co-operation and Development, for example, wants to facilitate non-members’ participation in discussions on metals. But it is seen primarily as a Western club, and so developing and emerging economies will be wary of entering such a setting.
There is also the Intergovernmental Forum on Mining, Minerals, Metals and Sustainable Development – but its 42-state membership includes just two EU states and does not include major players such as the US, China and Australia.
In addition, there is the set of intergovernmental International Metal Study Groups, whose purpose is to conduct research, promote dialogue and increase market transparency. While relatively successful in doing so, they are not a platform for broader political debate, they are concerned with just four metals (copper, lead, zinc and nickel), and their membership – ranging from 15 to 29 – is small and predominantly European.
A single international minerals forum, focusing particularly on metals and free from the taint of any political bloc’s agenda, is needed. In an inter-dependent global economy, it should be in every state’s interest to avoid autarky and to limit price volatility and speculation. This is easier when there is an impartial setting in which to air differences.
The membership of the forum should be as inclusive as possible. It should, therefore, not set ‘hard law’, as the WTO does, since binding obligations would probably dissuade too many countries.
The organisation would act as a facilitator, through research (for example) and primarily through the type of regular dialogue – both structured and informal – that is familiar in so many other parts of the international system. With all metals and other important minerals on the agenda, key players, such as China, should have a reason to attend.
One option would be to expand the membership of the Intergovernmental Forum, with deeper commitment on the part of members. Alternatively, a new organisation could be created to emulate the 86-member International Energy Forum (IEF), which brings together energy ministers for informal discussions.
The European Commission is currently mulling over a paper on a global raw-materials dialogue. France too has expressed much concern about commodities, particularly agricultural products, and price volatility.
They could start by pointing out the need to fill arguably the biggest gap in dialogue about raw resources: metals and other strategically important minerals. As president of the G20, France has an excellent podium from which to kick-start discussion on the development of a forum that brings together the world’s producers and consumers.
Roderick Kefferpütz is an associate research fellow at the Centre for European Policy Studies (CEPS) and an associate of the ‘Resource Strategy’ project at Stiftung Neue Verantwortung, a Berlin-based think-tank.
Click Here: kanken kids cheap