The U.S. wants to move forward with the Minerals Security Partnership (MSP), in an effort to shift supply chain for critical minerals away from China, as indicated at a separate meeting at the sidelines of the UN General Assembly. The MSP between the U.S., the EU, Japan and other advanced economies held a ministerial meeting with resource rich developing nations, including Argentina, Brazil, Indonesia, Chile, among others. U.S. Secretary of State Blinken chaired the meeting.

The MSP initiative was launched in June and is designed to attract investment in developing countries with mining projects that adhere to stricter environmental, social and governance standards.

“We created this to deal with a supply chain vulnerability that we’ve known has existed a long time,” U.S. Under Secretary of State Fernandez said. “But the pandemic has taught us that these vulnerabilities need to be addressed and minimized. And what we’re hoping to do is to galvanize investment, financing and other agreements.” he added.

The critical mineral supply chain remains almost totally dominated by China, which controls most of the market for processing and refining critical minerals, including battery metals and rare-earths.

Fernandez argued that the initiative was about providing options for developing nations and said Beijing would benefit from it as well if it becomes successful.

The minerals initiative may also get a boost from the Inflation Reduction Act (IRA), which was signed into law by Biden last month. Fernandez said he urged local officials in Mexico for partnership on project that might benefit from tax credits under the IRA.

In the coming months, the U.S. intends to continue meeting with mineral-rich nations and identify some of the first mining projects to benefit from the minerals security pact.