The new geoeconomics of critical raw material supply chains 

The New Geoeconomics and Politics of Critical Raw Materials

Key Takeaways:

• Geoeconomics redefines power in the 21st century by weaponizing trade, finance, and critical raw material supply chains—turning minerals like lithium into strategic geopolitical assets.

• Control over critical raw materials shapes global influence; economic statecraft now centers on securing, processing, and regulating these minerals to lock in long-term value and resilience.

• The future of lithium and other critical materials hinges on mastering complex fiscal regimes, supply chain architecture, and leveraging new technologies—where technical expertise and data governance become as crucial as geography.

By George Katito*

Geoeconomics has moved from a niche term to a core lens for understanding how power is exercised in the 21st century. It is not a synonym for geopolitics. It is, rather, a distinct way of seeing how states weaponise interdependence: using trade, finance, technology and supply chains as instruments of statecraft rather than treating them as neutral backdrops to “real” politics.

What is geoeconomics?

Where geopolitics traditionally emphasises territorial control, military capabilities and formal diplomacy, geoeconomics focuses on how states convert economic assets and networks into strategic influence. It asks how sanctions, export controls, investment screening, financial access and control over value chains are deployed to advance political goals, and how those same tools reshape macroeconomic outcomes.

In this sense, geoeconomics makes trade and finance central rather than peripheral to questions of power and security. It pushes policymakers, academics and firms to read balance-of-payments data, trade flows, technology standards and commodity supply chains as indicators of where power really lies and how it is being contested.

Critical minerals as power arenas

The green transition has created a new strategic map, organised less around oil shipping lanes and more around critical mineral deposits, processing capacity and battery manufacturing hubs. Lithium, cobalt, nickel, rare earths and related inputs are now simultaneously climate enablers and geoeconomic levers, with control over their extraction and processing conferring bargaining power in diplomatic and commercial negotiations.

This has turned upstream resource holders into pivotal actors in a way that goes beyond the old commodity boom–bust cycles. Decisions taken today on licensing, beneficiation, export regimes and local content will lock in patterns of dependence or resilience for decades, shaping who captures value and who bears environmental and social risk.

Zimbabwe’s evolving lithium strategy

Zimbabwe has begun to position itself within this new landscape by using law and regulation to influence how lithium is extracted and traded. The 2022 move to ban most exports of unprocessed lithium ore and concentrates signalled a clear desire to retain more value onshore rather than acting purely as a supplier of raw material.

This strategy is set to deepen with the anticipated tightening of export restrictions around 2027, which is expected to limit further the scope for shipping out low-value material and to encourage investment in processing and related infrastructure inside the country. In practice, Zimbabwe has allowed largely Chinese investors to establish and prove up reserves, creating substantial sunk costs that reduce the likelihood of rapid disinvestment and open space for more assertive renegotiation over time.

Major powers and the return of economic statecraft

Zimbabwe’s choices sit within a much broader return to economic statecraft among major powers. The United States has expanded its use of sanctions and export controls, pursued agreements to secure critical mineral supplies with key partners, and used tariffs explicitly as a tool of strategic competition. The European Union’s Critical Raw Materials Act similarly aims to ensure secure, sustainable access to key inputs, combining diversification, domestic projects and tighter screening of external dependencies.

For resource-rich states, there is now a growing menu of policy instruments to draw from. Chile’s approach to capturing copper rents, Saudi Arabia’s in‑kingdom value‑add programmes and Norway’s independently governed sovereign wealth fund demonstrate different ways of turning volatile resource income into long-term fiscal stability, domestic industrial capacity and broader development gains. These examples show that the “resource curse” is not inevitable; it is mediated by policy design, institutional quality and political choices.

Geoeconomics, lithium and the new map of power

The rise of geoeconomics suggests that, paradoxically, geography may matter less even as geology matters more. In traditional geopolitics, state behaviour is read through borders, neighbours and regional blocs; location determines threat perceptions, alliance patterns and strategic horizons. In a geoeconomic frame, by contrast, what counts is not where a state sits on the map, but where it sits in networks of trade, finance, technology and—crucially for the green transition—critical mineral supply chains.

Lithium makes this shift visible. What matters is less whether a producer lies in this or that “sphere of influence” and more how its ore bodies, processing capacity and logistics plug into global battery and EV value chains. Alliances are increasingly organised around shared interests in supply security, diversification and standards rather than inherited geopolitical categories. This does not abolish geography—transport costs, infrastructure and local politics still matter—but it does mean that geology, logistics and contractual architecture now shape power at least as much as territorial adjacency.

This reconfiguration also weakens the hold of older political narratives and ideological loyalties. Historical partners and “all‑weather friends” will remain important, not least because of sunk investments, diplomatic familiarity and security ties. Yet, over the long haul, what will sustain relationships along lithium and other critical mineral chains is less solidarity rhetoric than a hard‑headed alignment of interests: bankable projects, predictable regulation, credible enforcement and shared exposure to climate and market risk. Moral language does not disappear, but the underlying bargains become more overtly transactional and less anchored in Cold War‑era or post‑colonial scripts.

Finally, the cast of decisive actors is broadening well beyond foreign ministries and party ideologues. The future of lithium supply chains is likely to be steered at least as much by technical economic actors—treasury officials, central bankers, commodity traders, mining engineers, project financiers, standards‑setting bodies and grid planners—as by conventional diplomats.

Mastery of complex fiscal regimes, off‑take contracts, carbon accounting and risk‑sharing instruments becomes a central diplomatic skill.

As data volumes grow and markets move faster, non‑human actors will also enter the stage: AI models trained to optimise portfolios, simulate shocks and propose contract designs in real time may become de facto participants in geoeconomic bargaining. In that world, influence will accrue not only to those who own the minerals, but to those who design, govern and understand the technical systems that choreograph how those minerals move through the global economy.

*George Katito is CEO/Founder of Geostratagem