How China Spent $57 Billion to Control the World's Critical Minerals
China’s $57 Billion Investment Reshapes the Global Critical Mineral Landscape
Editorial Team (ET)May 8, 2025
China has systematically tightened its control over the global supply of critical minerals, pouring $57 billion into resource-rich nations over the past two decades. A new report from AidData, a research lab at the College of William & Mary, reveals how at least 26 state-backed financial institutions have coordinated a massive effort to dominate the extraction, processing, and trade of minerals essential to the energy transition.
This influence extends far beyond Beijing’s Belt and Road Initiative. While BRI projects focus on infrastructure, China’s mineral investments represent a more targeted and deeply entrenched strategy. These efforts ensure long-term dominance over key resources such as lithium, cobalt, copper, and nickel—minerals critical to electric vehicle batteries, solar panels, and advanced technologies.
How China is Financing its Mineral Takeover
Between 2000 and 2021, Chinese financial institutions directed nearly $57 billion in loans to 19 low- and middle-income countries. The structure of these investments was designed to maximize control while minimizing host government influence.
Joint ventures have played a key role, allowing Chinese companies to secure ownership stakes in mining projects while keeping financial risks at arm’s length. Special purpose vehicles have also been widely used, ensuring that Beijing’s influence over mineral supply chains remains firmly intact. Unlike BRI loans, which are typically issued by a small group of state-backed development banks, critical mineral financing involves a much broader range of lenders, including the Industrial and Commercial Bank of China, Bank of China, and Citic.
China’s lending strategy relies heavily on serial loans rather than one-time deals. According to the AidData report, nearly a quarter of all mineral-related loans included guarantees from Chinese institutions—a stark contrast to general BRI projects, where such guarantees were present in only 4 percent of cases. This highlights China’s long-term commitment to securing upstream mineral resources and strengthening its global supply chain dominance.
China’s Global Mineral Expansion
The scale of China’s critical mineral investments spans multiple continents, with a heavy focus on nations rich in essential resources. The Democratic Republic of Congo and Peru have been primary targets for copper and cobalt, which are crucial for battery production. Indonesia has seen an influx of Chinese investment in nickel mining, an essential component in lithium-ion batteries. Argentina has become another focal point, with major Chinese stakes in lithium brine projects.
One of the most significant examples is Ganfeng Lithium, which holds a 46.7 percent stake in the Caucharí-Olaroz lithium brine project in Argentina. This strategic acquisition ensures China’s access to a stable lithium supply at a time when global demand for electric vehicles is skyrocketing.
The scale of Chinese investments continues to grow. A recent report from The Economist highlighted that in 2023 alone, Chinese companies poured $16 billion into foreign mines, the highest level of investment in a decade and a sharp increase from less than $5 billion the previous year.
The Consequences of China’s Mineral Control
China’s mineral dominance presents both economic advantages and geopolitical risks. For Beijing, these investments guarantee a long-term supply of the raw materials needed to sustain its manufacturing sector and technological expansion. By controlling extraction and processing, China effectively dictates the global flow of critical minerals, giving it a powerful economic and political advantage over competing nations.
For resource-rich countries, the impact is far more complex. Many of these deals exclude significant local ownership, reducing financial liabilities for host governments but also limiting their access to future economic returns from mineral extraction. In two-thirds of cases analyzed in the AidData report, joint ventures and special purpose vehicles were structured in a way that kept government stakes minimal.
This approach raises concerns over sovereignty and long-term economic sustainability. While Chinese investments provide immediate capital and infrastructure, they often leave host nations with little leverage over their own natural resources. In the long run, this could result in a situation where local economies remain dependent on Chinese companies for both extraction and processing, reducing their ability to build independent, self-sustaining industries.
A Global Power Struggle Over Minerals
China’s aggressive push to secure critical minerals has not gone unnoticed. Western nations, including the United States and the European Union, are scrambling to counter Beijing’s dominance by developing alternative supply chains. Washington has ramped up efforts to diversify mineral sourcing through domestic production and partnerships with allied nations. The European Union has introduced initiatives aimed at reducing dependence on Chinese-controlled supply chains.
Despite these efforts, China remains far ahead in the race for control over the world’s most valuable resources. With vast financial reserves and an intricate investment strategy, Beijing continues to outmaneuver its global rivals. The question now is whether competing nations can respond quickly enough to prevent a long-term monopoly on the minerals that will define the future of clean energy and high-tech industries.
