Mr. Chair, thank you very much for inviting me to address this committee.
My name is Nikos Tsafos. I hold the James R. Schlesinger chair for geopolitics and energy at the Center for Strategic and International Studies in Washington, D.C. I have spent my career at the intersection of energy and geopolitics, so I am grateful for the opportunity to share some thoughts on the importance of critical minerals for the energy transition. I have four points that I'd like to leave you with.
First, we cannot lower greenhouse gas emissions without critical minerals. These two go hand in hand. By some estimates, the global demand for critical minerals could increase sixfold up to 2050. For some products, like cobalt, nickel and lithium, the forecasted growth is even greater. No matter what the actual numbers end up being, there is no doubt about the direction of travel. Based on current technologies, there is no pathway to decarbonization without more mining.
Second, critical minerals will, over time, become more important than hydrocarbons. Today the international trade in energy consists mostly of oil and gas. One day the trade in critical minerals will supersede that trade in fossil fuels. People like me who study energy security, who today look at the Middle East or Russia, will one day be looking at the lithium triangle in South America. They will focus on Australia, Chile, Indonesia and the Democratic Republic of Congo. We will need new mental maps to process and to think about this world.
These global flows will create new linkages and dependencies. We can also expect them to create tension. Who can develop this resource? Who benefits from it? Who bears the costs? We can already see the fault lines of mining across the world, from Serbia to Bolivia and from Indonesia to Nevada here in the United States. This is a global story, but the politics and the tensions are local.
Third, China has already built a commanding position in critical minerals. China produces some minerals, but its dominance really comes from the processing part of the value chain. China is where commodities go to be turned into useful products. This capacity gives China and Chinese industry a competitive edge in many of the sectors that will be essential for the energy transition. We cannot talk about critical minerals without talking about China.
That brings me to my fourth and final point. The west really needs a strategy for critical minerals. The end goal, as far as I can tell, is clear. We want adequate supply that is produced responsibility, with a fair allocation of costs and benefits among companies, governments and local populations. We also need supply chains that are resilient, not ones that run solely through China. There's a lot of work to do that—to grow supply, to build capacity, to strengthen governance—but the most important objective we have is to ensure that western companies have access to the minerals needed for the green economy.
Supply chains without China are impossible, but supply chains dominated by China are unacceptable. Critical minerals and the industries they enable are too important to be left alone. Western governments should tackle these questions together, because the stakes are too high for any other approach.
Thank you for the opportunity to address the committee on this important topic. I look forward to your questions.