Critical Raw Materials: Negotiating the Politics Behind the Green Transition

Critical raw materials such as cobalt, lithium and rare earth elements have become indispensable to modern economies. They power electric vehicles, renewable energy systems, and energy storage, but are also central to consumer electronics, defense technologies, and other strategic industries. At the same time, their extraction and processing are increasingly entangled with geopolitical competition, concentrated supply chains, environmental degradation and concerns over labor and human rights.

These tensions make critical raw materials more than a question of securing access to resources. They raise political questions about who controls resources, who benefits from their extraction, who carries the environmental and social costs, and who gets to participate in the decisions surrounding them. These questions are particularly relevant for resource-rich countries and regions, including the Western Balkans, where debates over mining increasingly intersect with questions of democratic governance, transparency, development and environmental protection. The preparatory material for the workshop therefore invited participants to consider precisely these tensions: ethics versus economics, transparency and governance, environmental risks, geopolitical competition, and the balance between local and global interests.

On 28 August, Friedrich-Ebert-Stiftung brought these dilemmas to the Young Bled Strategic Forum in Kranjska Gora through The Agency Dilemma: To Cooperate or Separate?, an interactive negotiation simulation. This workshop continued FES' cooperation with the Bled Strategic Forum.

Rather than discussing these challenges only in the abstract, participants faced a fictional cobalt investment involving two countries, a resource-dependent industrial economy and its resource-rich counterpart. The proposed investment promised greater supply security and economic opportunities, but came against the backdrop of unresolved environmental damage, contested permits, protests, opaque ownership structures and demands from local communities for greater participation and a fairer share of the economic benefits. Participants had to reach a collective position, formulate concrete conditions, and defend their decision publicly.

From individual preferences to political compromise

The exercise was structured to replicate an important feature of democratic politics: having a preferred policy is not the same as being able to build agreement around it.

Participants entered the negotiation with specific interests, preferred outcomes, red lines and concessions they were prepared to make. This tension was also reflected in participants' evaluation of the exercise. Compromise and reaching politically realistic agreements emerged as key challenges. Final collective decisions also frequently differed from participants' individual preferences — making the trade-offs inherent in collective decision-making particularly tangible.

At the same time, participants repeatedly pointed towards the importance of bringing local communities, civil society and expert voices more strongly into decisions over critical raw materials. Their responses echoed one of the central questions with which the workshop began: how can the benefits of critical resources be shared fairly, sustainably and transparently?

For Friedrich-Ebert-Stiftung, this question cannot be separated from the wider debate about the green transition. Diversifying supply chains and reducing strategic dependencies are legitimate political objectives. But resource security alone does not constitute a just transition. Decisions over extraction must also address democratic participation, environmental responsibility, decent economic opportunities and the distribution of benefits and risks.

The green transition therefore requires more than new resources and new supply chains. It also requires democratic institutions capable of negotiating competing interests — and ensuring that the communities most affected by these decisions have a meaningful voice in making them.