The German government is significantly scaling back the funding allocated to a raw materials fund managed by the state-owned KfW Bank, according to reports from “Der Spiegel”. The fund, designed to support companies investing in the extraction of critical resources like lithium and rare earth elements, is now projected to receive 13.38 million euros in its 2025 budget. This represents a substantial reduction compared to the 29 million euros initially proposed in a draft budget from the previous government.
The purpose of the fund is to bolster domestic supply chains and reduce reliance on foreign sources for these strategically important materials. The revised budget figure, while lower, is intended to cover all projected expenditures for 2025, according to a statement from the Ministry of Economic Affairs, led by Minister Katherina Reiche. The Ministry maintains that the overall framework of the raw materials fund, which allows for investments of up to one billion euros, remains in place.
The decision to curtail funding has drawn criticism, particularly from the Green Party. Franziska Brantner, co-chair of the Green Party, cautioned that the move highlighted the potential vulnerability of Germany’s supply chains, referencing recent actions by Chinese President Xi Jinping as a cautionary example.
The Bundestag’s budget committee is scheduled to discuss Minister Reiche’s budget in August, providing an opportunity for further scrutiny and debate regarding the funding levels for the raw materials initiative. The focus remains on securing resource independence and ensuring a stable supply of vital materials for the German economy.
