In Geopolitics This Week
Germany Boosts Latin American Ties for Lithium Supply, The US to Assume Larger Military Presence in the Philippines, Chinese Surveillance Balloon Shot Down in US Airspace, and other stories.
Germany Boosts Latin American Ties for Lithium Supply
German Chancellor Olaf Scholz recently took a business delegation on a tour of Latin American countries Argentina, Chile, and Brazil to promote energy cooperation and secure supplies of critical raw materials, such as lithium. Lithium is a key component in the production of batteries for electric vehicles, making it a crucial element in the global energy transition.
The German government has announced plans to revamp its strategy for reducing dependencies on critical raw materials, with lithium playing a central role. As part of the trip, Scholz signed cooperation agreements with the presidents of Argentina and Chile, which included the establishment of the German Accelerator in Buenos Aires and a German-Chilean Partnership for Mining, Raw Materials and the Circular Economy. The German government must work with a powerful domestic auto industry that is very concerned about the future of lithium supply. Argentina and Chile sit at the top of South America’s lithium triangle, offering an abundant supply of the metal.
China has limited domestic lithium reserves but dominates global lithium refining capacity, which gives the country a large presence in global battery production. China has invested heavily in the “lithium triangle” countries, acquiring multiple lithium mining operations across the region. Lithium demand is expected to surge in the future, making Germany's reliance on China a vulnerability that Berlin feels must now be addressed.
The US to Assume Larger Military Presence in the Philippines
The United States and the Philippines have decided to accelerate the implementation of their Enhanced Defense Cooperation Agreement (EDCA), which aims to support joint training, exercises, and interoperability. The US has allocated some $82 million for infrastructure improvements at five current EDCA sites and for expansion of its military presence to four new sites in strategic areas of the Philippines.
During his visit to the Philippines, US Defense Secretary Lloyd Austin went to the southern city of Zamboanga where he met with Filipino generals and US forces stationed in the country. Washington has been providing intelligence and combat advice to Filipino troops for years, and more recently US forces have increased the number of joint training operations with Filipino troops on the nation's western coast and in the northern Luzon region.
The US defence chief is the latest senior official to visit the Philippines after Vice President Kamala Harris in November, indicating warming ties after a period of strained relations under former Philippine President Rodrigo Duterte. The Philippines is Washington's oldest treaty ally in Asia and a crucial front in the US strategy against China. The Philippines and other ASEAN members also remain locked in territorial disputes with China over the South China Sea and Washington has pledged to defend the Philippines in the event of an attack in these contested waters.
The US already has access to five Philippine military bases under the 2014 EDCA defence pact, with Washington now seeking access to five additional military camps in the country’s north. US access to military facilities on the island of Luzon would give Washington a strategic position from which to mount operations in the event of a conflict in the South China Sea. Luzon is less than 200 nautical miles from Scarborough Shoal and a similar distance from the southernmost tip of Taiwan, over which tensions have recently been mounting.
Chinese Surveillance Balloon Shot Down in US Airspace
The United States Department of Defense has tracked and destroyed a high-altitude surveillance balloon believed to be from China. The balloon posed no military or physical threat and was not considered a significant intelligence threat by US defence officials. The Chinese Foreign Ministry confirmed the balloon was from China and explained that it was a civilian airship used for meteorological research that accidentally entered US airspace.
The balloon reportedly passed over sensitive nuclear sites in Montana as it drifted across Canada and the United States before being shot down by an US F-22 Raptor just off the coast of South Carolina. President Biden and Defense Secretary Lloyd Austin stated that the balloon was shot down over water to protect the safety and security of the people.
For China, the situation was likely not foreseen. The unintentional intrusion of the Chinese surveillance balloon into US airspace can be seen as a violation of US sovereignty and has taken both nations by surprise, hindering Beijing's efforts to improve relations with Washington. Despite making efforts to ease tensions since the meeting between Biden and Xi last year, the future impact of this unexpected event on diplomatic relations between the two remains unclear. Some members of the US Congress and politicians are using the incident to escalate tensions and raise concerns about China.
The balloon incident has already impacted working relations between Washington and Beijing after Secretary of State Antony Blinken's postponed his upcoming visit to Beijing. The delay in a meeting between the two countries' senior leaders will be a missed opportunity and the future of such a visit is now uncertain. China's reaction suggests that they have more to lose from the incident, which could work to damage China's diplomatic relations with other nations.