A new report from the Center for Strategic and International Studies (CSIS) by critical minerals expert Gracelin Baskaran describes how the rate at which Chinese firms are acquiring key critical minerals projects means that the West is unable to keep up or compete.
Baskaran writes that overseas acquisitions by Chinese firms reached their highest level in 2024 in over a decade, with more than 10 transactions totalling over US$100 million ($140.4 million).
“The broader trend is even more striking: 2024 was the busiest year for Chinese overseas mining investment construction in over a decade, underscoring Beijing’s long-term strategy to secure ownership of the mineral resources that will shape future industrial and geopolitical competition,” Baskaran says.
Baskaran ultimately notes that the US and its global allies need to develop a more coordinated approach to monitoring, financing, and protecting strategic mineral deposits in order to gain control of the key resources needed for the future.
As previously reported by Mining.com.au, the US is making significant moves to gain control over critical minerals supply chains, with a focus on both domestic and international projects, and is deploying billions of dollars to make this happen.
A case study on Tanzania
Baskaran highlights Tanzania as a perfect case study of China’s overseas acquisitions strategy and where the West is missing out.
In 2010, Peak Rare Earths discovered the Ngualla deposit, one of the most globally significant undeveloped rare earth resources. The company was acquired by China’s Shenghe Resources Holding (600392.SH) for around $158 million, but not without a last-ditch effort by General Innovation Capital Partners, a US private equity firm, to acquire it, too, and at a higher price.
Peak delisted from the ASX in October 2025 and ownership of Ngualla passed to Shenghe. Baskaran notes that this type of transaction reflects a stark reality: “Chinese firms are often willing to pay substantial premiums for strategically important mineral assets”.
“In doing so, they are not merely acquiring mines; they are securing future supply and limiting the pool of assets available to competing supply chains.
“If current ownership and offtake arrangements remain in place, China is on track to receive all rare earth production from Tanzania by 2029, giving Beijing significant influence over one of the world’s most important emerging sources of rare earth elements.”
Proactive versus reactive approaches
Baskaran notes that the West often takes a reactive approach to these opportunities, not because of a lack of will, but a lack of a comprehensive, real-time registry of critical mineral assets worldwide, and therefore it has limited visibility into which projects are seeking capital or are potential acquisition targets.
“In many cases, a potential acquisition only comes to the attention of US embassies or government agencies once negotiations are well advanced or the transaction is nearing completion,” Baskaran says.
“By that stage, the prospective Chinese buyer may already have secured exclusivity agreements, conducted due diligence, and arranged financing, leaving little room for Western governments or companies to mount a competing offer.”
Knowing what opportunities exist is essential, but Baskaran notes that having the legal authority to act is equally important.
Within both the US and Australia, domestic screening regulatory bodies can sometimes block foreign acquisitions of local assets, but they do not cover projects overseas, meaning that US or Australian companies with overseas assets can be targets for acquisition by Chinese companies.
The report recommends four strategic moves that can help the West gain access to these key projects. These include improving visibility of projects through a centralised, comprehensive critical minerals asset registry; creating formal early-action work with allied trading partners; strengthening US and allied embassies globally to improve strategic monitoring of mineral assets; and establishing a rapid-response financing capability.
Baskaran ends by noting that the West needs to approach critical minerals acquisitions similar to how China does — through a “coordinated ecosystem”, with a common objective to secure long-term control over critical minerals.
With the competition for critical minerals reaching peak levels, she recommends that the US and its allies “build institutions capable of identifying and protecting strategic assets before they change hands” or risk losing the resources and the opportunity to control supply chains.
Write to Amy Rotman at Mining.com.au
Images: Getty Images
