Merkel Aims to Sign Rare Earths Deal With Mongolia Next Week
Oct. 7 (Bloomberg) -- Chancellor Angela Merkel will seek to strike a deal on resources with the Mongolian government during a trip to Ulan Bator next week that secures access to rare-earth elements at fair prices, a German government official said.
Mongolia’s potential for rare earths is enormous and Germany is confident of reaching an outline agreement at government level that would allow companies to sign individual contracts ensuring access to the materials, the official told reporters in Berlin today on condition of anonymity because the deal has yet to be struck. The official cited Munich-based Siemens AG, Europe’s largest engineering company, which he said needs rare earths for turbines. German companies may offer infrastructure and clean-energy investments in return.
As Europe’s biggest economy, Germany is at the forefront of efforts in Europe, the U.S. and Japan to diversify their sourcing of rare-earth elements used in everything from hybrid vehicles and flat-screen TVs to weapons systems after the Chinese government last year announced cuts in production. China produces more 90 percent of the world’s rare earths.
Germany is already looking to draw rare-earth elements from two Canadian mining projects that former German Economy Minister Rainer Bruederle has said might supply as much as 5,000 tons of rare earths a year from 2012 or 2013. “There’s the danger that we could get an iron-ore OPEC or a rare-earths OPEC,” Bruederle said during a trip to Canada last year, comparing the potential monopoly to the Organization of Petroleum Exporting Countries.
Merkel will travel to Vietnam as well as Mongolia during her trip from Oct. 10-13. The European Union aims to strike a free-trade agreement with Vietnam that Germany strongly supports, the official said. Merkel will speak about investment conditions, the bane of corruption and lobby for more legal security in Vietnam, according to the official.
--Editor: Alan Crawford
To contact the reporter on this story: Stefan Nicola in Berlin at snicola2@bloomberg.net
To contact the editor responsible for this story: Reed Landberg at landberg@bloomberg.net
Mongolia’s potential for rare earths is enormous and Germany is confident of reaching an outline agreement at government level that would allow companies to sign individual contracts ensuring access to the materials, the official told reporters in Berlin today on condition of anonymity because the deal has yet to be struck. The official cited Munich-based Siemens AG, Europe’s largest engineering company, which he said needs rare earths for turbines. German companies may offer infrastructure and clean-energy investments in return.
As Europe’s biggest economy, Germany is at the forefront of efforts in Europe, the U.S. and Japan to diversify their sourcing of rare-earth elements used in everything from hybrid vehicles and flat-screen TVs to weapons systems after the Chinese government last year announced cuts in production. China produces more 90 percent of the world’s rare earths.
Germany is already looking to draw rare-earth elements from two Canadian mining projects that former German Economy Minister Rainer Bruederle has said might supply as much as 5,000 tons of rare earths a year from 2012 or 2013. “There’s the danger that we could get an iron-ore OPEC or a rare-earths OPEC,” Bruederle said during a trip to Canada last year, comparing the potential monopoly to the Organization of Petroleum Exporting Countries.
Merkel will travel to Vietnam as well as Mongolia during her trip from Oct. 10-13. The European Union aims to strike a free-trade agreement with Vietnam that Germany strongly supports, the official said. Merkel will speak about investment conditions, the bane of corruption and lobby for more legal security in Vietnam, according to the official.
--Editor: Alan Crawford
To contact the reporter on this story: Stefan Nicola in Berlin at snicola2@bloomberg.net
To contact the editor responsible for this story: Reed Landberg at landberg@bloomberg.net
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