Ex-UK Deputy PM: A Global Push for Metals is Here, This is the 3-Point Plan to Win
Summary
Market Volatility: The podcast discusses recent market volatility, particularly in gold and critical minerals, driven by geopolitical tensions and trade policies.
Geopolitical Tensions: Beijing's control over critical minerals has led to significant economic impacts, with the US responding with tariff threats, highlighting a potential new global conflict over raw materials.
Artisanal Gold Mining: Dominic Rab emphasizes the importance of integrating international efforts to formalize artisanal and small-scale gold mining (ASGM) to curb illicit trade and support legitimate miners.
Global Initiatives: The formation of the Coalition for Action on ASGM, involving the UN, OECD, and World Bank, aims to streamline efforts across law enforcement, development, and environmental sectors.
Strategic Metals Supply Chain: The podcast highlights the need for public-private partnerships and strategic "friend-shoring" to build resilient supply chains for critical minerals, reducing dependency on China.
Investment and Policy Recommendations: Rab suggests that seed capital, permitting reform, and a hub-and-spoke model for supply chains are crucial for securing a stable supply of strategic metals.
Public-Private Partnerships: The discussion underscores the role of government-backed initiatives in mitigating risks and attracting private investment in mining projects, particularly in politically unstable regions.
Transcript
Hey everyone, I'm Jeremy Sappin. Welcome back. All right, gold is seeing some profit taking today after its recent runup past $4,300 on the spot side. But the real story is the volatility shaking every corner of the market. Now, over the past week, we've seen a seismic shock on the global economy because Beijing has weaponized its control over the critical minerals that power. Everything from our phones to fighter jets. Now, the US has threatened 100% tariffs in response, wiping out more than $1.5 trillion dollars from global markets. But just this morning, President Trump told Fox Business those high tariffs are quote not sustainable, adding yet another layer of uncertainty to this crisis. Now, this might not just be a trade war anymore, but a new global conflict over the raw materials of the 21st century. Now, our next guest has been warning about this for years. Dominic Rab is the former deputy prime minister and foreign secretary of the United Kingdom and a year ago he partnered with the world gold council to author the explosive silence is golden report which laid out how the illicit gold trade is used to fund war and terrorism. Now today he sits at the intersection of private capital and geopolitics obviously still with the world gold council but also the head of global affairs at Aion Capital a major private equity firm in the mining sector. Uh Mr. Rab thanks for joining us appreciate your time. Thank you. >> Okay. Well, we got lots to get into today. There's lots obviously hitting the wires, but I want to start with your core area of focus. I mean, a year ago, you partnered with the World Gold Council, friends of ours, obviously we have them on quite often on this report, the silence of of is golden. Now, for our audience, this was an explosive look into the world of artisal and small-scale gold mining, or as we'd like to call them, ASGM. Now, it does account for a massive 20% of the world's gold supply. something I think often our audience forgets and and you detailed how this sector is exploited by criminal networks to fund conflict and terrorism. I got to ask you, I mean, you know, now that a year has passed and gold is of course front and center in headlines, what's the single biggest change that you've seen on the ground? I mean, has that that silent actually been broken? >> Yeah, the silence has been broken. That's uh um fair to say. And look, but this is going to be a big problem and it's going to be a marathon, not a sprint in terms of dealing with it. I had 24 recommendations. I think we're realistic about how long that's going to take. But so one of the big recommendations with more integration across all the different international actors. Well, uh we've launched this coalition for action on ASGM as you rightly referred to it with the UN, the OECD, the World Bank, um and the World Gold Council. And that's really important because there are lots of disperate initiatives. We need to make sure they're integrated. So the law enforcement, the development side, the environmental side are brought together otherwise they work uh in tension if you like. Then drilling down uh to the ground level there's also some important initiatives taking place on the ground. So for example, we're seeing central bank purchasing schemes of gold interlink with artisal gold miners and we want to distinguish between the legitimate uh well-meaning responsible artisal gold miners and give them uh a safe and viable supply chain. Central bank purchasing schemes we've seen in Latin America um uh are an important part of that. We've seen it in Colombia, Ecuador um also Mongolia and the Philippines as well. Um so so that's some progress uh and particularly when it's done in accordance with the London principles which are the world gold council's principles about how those central bank purchasing schemes can be done and and I think it's important to distinguish between them and the responsible ASGM and the predators we we don't want to tile them all with the same brush. The second thing which at ground level I think is really important is on a similar vein. How can we bring the processing uh of um artisal gold to the artisal gold miners on the ground? Because obviously the big major refines and smelters are a long way away. These artisal gold miners may have a birth certificate. The capacity building um that needs to go on around them uh is still significant. So we've seen some local processing plants for ASGM uh Dina uh calls Inca 1 uh plant in Peru which procures ASGM gold uh services Rolex services central bank purchasing schemes similar scheme set up in Tanzania. So I don't want to come on the show with accounts of despair. We have started to see some of the progress. The big thing going on right now for your viewers will be the G20 and the G7. What we'd really like to do is on top of those important initiatives, get this on the agenda and in the resolutions and in the declarations coming out of both the G7, the G20. That gives us a real political shove and a push to get those other recommendations done. >> Yeah. Yeah. Good point. And I mean, obviously a key part of that call to action is that coalition of willing. I mean, you brought it up there, the G7 and G20 nations working together to crack down on these illicit flows. But you know, when we look at the agenda for the upcoming G20 summit in South Africa, the conversation seems to have shifted. I mean, they're talking about value addition, beniction, price stability, not really a coordinated security crackdown. Has that coalition materialized or has the global scramble for strategic metals kind of pushed this security agenda to the back burner? >> Well, we'd love to see the two work in tandem. There's lots of good reasons why they should. Look, the G20s is represents disperate and different views. They're really important because they straddle uh many of the countries where uh ASGM takes place. We know that there have been some real leadership steps forward uh countries like Brazil. I was in Rio at an event with around my report silence is golden and we had everyone from uh members of the Ministry of Defense uh Ministry of Foreign Affairs and those worried about the environmental pollution there. I think there's um a great role for Brazil, a leadership role if you like in all of this. Um it's there's obviously uh the the presidencies um uh under South Africa. We know that they are concerned around this as well. So we haven't yet seen the obviously the full conclusions and declarations but we've been trying to feed in. We want to get it on the agenda. And I think as well there's a virtuous cycle to be done and to be made and to be transformed out of this vicious cycle. If we can get the G20 and the G7 to pay attention and look at all the different aspects, I think you will see it really put rocket boosters under the concrete practical reforms that we need to see. So I remain stubbornly optimistic. >> All right, that's good. Stubbornly optimistic. I mean, Brazil is often cited as kind of that bright spot in the space. It's the new what is it called? the Orolegal Plus program and it's brought what 120,000 artisal miners into formal supply chain since January cutting those mercury use by about 40% according to Brazil's mining ministry. It seems like it's real progress. I'm curious, you know, how scalable is that success outside of Brazil's unique regulatory environment and enforcement capacity? Can this be replicated in Africa or Southeast Asia where governance is is weaker and and corruption seems to run a little deeper? Yeah, you're you're absolutely right to point to that and I do think it's important to point to the good practice because we want to share it and then we create the best practice and then you get that virtuous cycle and Brazil has done some interesting things on law enforcement to go with um the supply chain viability for artisal gold miners. Things like G GPS um uh use uh traceability technology for for gold which is once it's melted down very hard to track across borders. So but but yeah, there's no reason why not. It may require a bit more capacity building which is why G7 development policies to support those countries which host um ASGM will be important but there's no reason why not and um you know Tanzania has uh a local processing a set of set of local processing plants um so so at grassroots level there is action on the ground in that country as well what we need to try and do is is not not try and set up um potential no-go areas. With the right support, with the right political will, uh we can resolve this problem. It won't happen in six weeks. It won't happen in six months. It's going to take years. But I think there is a real sense that the uh technology uh the legal frameworks and the international uh wherewithal is there to actually shift the dial so that you create this virtual cycle where artisal gold miners can uh elevate themselves out of this rut and and plug into a viable supply chain and sell their gold on the market. and along with the law enforcement measures uh that can crowd out the bad actors, the mercenaries, the drug traffickers, Islamic State and al-Qaeda who are oper operating in the Sahel. So yes, I think I think it's all doable with political will and with this uh extra integration at the international level which we're just starting to see. >> Yeah. Yeah. Just starting to see. I mean, you know, your report also championed uh formalization, you know, bringing these smallcale miners into the legal system. And of course, we've seen some positive steps like that new mercury free processing plants in in Peru and Ghana. I mean, we got to be frank, the core problems, corruption complex, licensing, and the lack of, I guess, political will are still as entrenched as ever. And you just kind of talked about it, but I have to ask you, was the vision of formalizing the entire sector on a global scale ever, you know, realistic? We're getting closer. What do you think in timing? >> Yeah, you got to you got to weave in two things. I always think it's doable, right? Um let we we No one makes any progress with a great challenge and this is a great challenge and a great security threat unless we really go in there with some uh confidence that we can get this done. But I think the two things are one the legislative frameworks which we can work with parliaments and national law makers and there are good templates around for doing that and then making it real on the ground and that is where uh and you've got to think an artisal gold miner may not have a birth certificate let alone an app and certainly not the kind of compliance department that a big mining company would obviously have. So um what you need is these local processing plants which in return for some basic rudimentary standards will buy the gold at a reasonable price and then can link into the central bank purchasing schemes. Then you give those artisal miners a positive lifeline. If we can spread the best practice which along with the formalization in the national legal frameworks under underpin and support each other then then then we're with a great shot of shifting the dial and turning the tide on this. >> Yeah. You know when we kind of look at it I mean what's the minimum threshold of of governance capacity or maybe political commitment must a country kind of have before scaling that Brazil style framework that you're talking about? I'm curious which countries today maybe already meet the bar in your eyes. >> Well, I think where look where the the um the the the um the first signatorries to the London principles for the World Gold Council's partnership with the central with central banks. Well, Colombia, Ecuador, the Philippines, Mongolia. Um there is also uh not yet a central bank purchasing scheme but sharing of best practice with Brazil. So these countries can shine a light um and show the way and once you start doing it in practice, you learn each time each um each country is different as you quite rightly said and you learn lessons and then you start to raise the bar and you encourage best practice and you get this snowballing effect, this virtuous cycle. Yes, of course there's there's corruption. We need to try and root that out. That's um that's a great challenge. There's in um Latin America, there's a big problem with the drug trafficking cartels as they look to diversify away from cocaine. And obviously in countries like the Central African Republic, uh there's a a fundamental security problem which is how the Vagna Group got in there in the first place, a sort of Fouian bargain where they traded um in return for security services from from the Vagnner group access to their artisal gold mining um uh resources. that that clearly is something that we've got to to tackle and I've set out um specific recommendations to deal with it. But I think uh if you look at the whole package of measures um and you look at the whole mountain that we've got to climb, it looks pretty daunting. But step by step, every time a country introduces some reform, whether it's their legal frameworks through legislation, whether it's one of these local processing uh plants, we make we make a step forward. Uh, and that's bad news for the bad actors because they can't thrive in those areas. So, it'll take uh baby steps along the way, but step by step, I'm confident that we can get there. >> Yeah. And leading by example, too. Uh, okay. Well, we got to pivot now from the specifics of artisal gold to the broader hunt for metals because the security issues that you raised in your report a year ago now seem to be playing out on a global strategic scale. I mean, back in October 9th, Beijing moved to control that entire value chain for rare earths, restricting technology and personnel, even trace amounts of finished product. The US responded with that threat of 100% tariffs, though President Trump is now walking that back, saying it's not sustainable. From your perspective, as a, you know, former secretary, I mean, is this just another round of trade war posturing or or does this signal a fundamental rupture in the global economic order here? >> Yeah, it's a great challenge. Look, first of all, this is not um notwithstanding the news around uh the new export controls on rare earths from Beijing. This has been a challenge building up for 20 years. China has concentration of the market 60 70 if you include the refining and processing of rare earth and other uh critical minerals like graphite, you're talking upwards of 90%. Um so and this has been a long time coming. China has a very concerted plan. they've stuck at it for many years. Um, and they use all the tools of a command economy to build up that concentration. Um, and uh, there's exponential demand for all of these critical minerals, whether it's for the copper for data centers, the cobalt for our smartphones, the lithium for our EV batteries, and increasingly the defense requirements, whether it's missile defense or fighter jets. Um so there's a exponential demand and a chokeold over supply. The the the question is how do we build up the alternative supply chains uh to get around these trade restrictions particularly the export controls and I think there's two things that are critically important. um one is better public private partnerships so that governments can provide the kind of support in particular financial support but other other things like permitting of mining projects that can encourage and unlock the investment. The second thing is we hear a lot of talk about onshoring and it's it's clearly important. It's true in the United States. European Union is doing something similar. Canada and Australia hum to a similar sort of tune albeit um slightly different context. But um I think we need a hub and spoke model where countries on shore when they can but French shore with high trust partners where they must. Rar is a great example of it and you look at Brazil and Vietnam that's something like 37% of global supply right there. Uh we have at Appian Capital we have Gibsland Critical Minerals which um is got the potential to supply 7% global supply. We've got a processing uh plant in um Virginia Atlantic Strategic Minerals which can do in due course some of the refining and processing for that. So what I'm saying is that you've got to put these links together and where uh countries can't do it alone team up with these high trust partnerships and a combination of public private partnerships with business with investors and the strategic friend shoring that is the way that we can provide the range and the depth of um supply in all of these areas that the US Europe needs Australia Canada as well. Yeah, very interesting on the French shoring. Uh, we got to get into that topic, but before we do, I mean, you recently wrote that the West has kind of been asleep at the wheel on on the issue. I mean, China now controls nearly 90% of rare earth processing, and their new rule could mean that if a, you know, an F-35 fighter jet or a Tesla built in Texas could effectively require a Chinese export license to be sold. I mean, you talked about that last 20 years, how this isn't new. I'm curious, how did the West allow this level of strategic dependency to happen? You know, I always think of President Eisenhower's famous quip in the 50s that he's got serious problems and urgent problems, but the urgent problems aren't serious and the serious problems aren't urgent. It's a general I think it's a genuine challenge. Um I'm not sort of pessimistic about the prospects for um liberal democracies in the West at all. But we got to play to our strengths and one of our vulnerabilities is we just think too short term as the Eisenhower quip shows. So we've got to do some some straightforward things like learn how to plan longer term. Um certainly in mining projects whether it's the extraction or the refining and the processing is a great challenge to get patient capital invested in. So we need governments to provide seed capital. You see with the US administration and the mounted pass deal which has had so much commentary rare earth's um project with the department for war uh the Pentagon investing in uh providing a floor price at double market value for rare earth taking a 50% equity stake in that company. Um so that's a good example of onshoring if we're going to deal with the range and the volume required that's going to have to be expanded more generally. I I'm you know it's it's open for debate whether floor um prices at at that level are sustainable across the piece but I think it's a very bold first step and um and one way or another we need to level the the playing field for for cap capital expenditure which China has a head start and a huge advantage because again of that command economy and the subsidies that they'll avail themselves of. So we're certainly starting to see the west wake up. I think the the new US administration has come in with some really interesting um initiatives. Exim uh bank which is the US export import bank is now more inclined to finance projects abroad where there's offtake and supply chain security at home. Uh that's another example and we're working with all governments around the world. We've talked to the US about what those public private partnerships can look like. Um so we've got some conceptual ideas. We need to unlock that private sector investment, but we also we also need to recognize this isn't a free market. And we need to try and sustain, to go back to your original point, the kind of staying power, if you like, commercially and politically that uh has has left us so far behind China. >> I like that. I like that long-term thinking point because we're so often thinking about just, you know, the next quarter and and it brings us to that friend shoring that you're talking about building supply chains through allied nations. I mean, we've seen it kind of fail before, right? The West has backed rare earth projects in places like Brazil only to see the raw material still end up going to China for processing because that's where the refineries are. How do you build the entire value chain from mine to magnet without China? And in which countries are kind of the key players on this new geopolitical chessboard? >> So, it's a great challenge. Um, let me give you one concrete example to see how show you how it's done. We we own a company called Graphcoa in Brazil produces high-grade graphite. Um we also then own uh a company called Herbix in um Arizona which processes it and thereby feeds the EV market in North America. Um there's some financial support that we're hoping to see confirmed shortly. Um but that also involves French shoring. Now, Brazil's got a huge amount of natural resource in this area. Um, and I mentioned rare earth as well as graphite. There are other countries and the Philippines, Chile, Argentina, Saudi Arabia wants to uh not just invest in this space, but also do some of the refining and the processing uh and probably has cheaper energy costs and easier permitting than in other countries. If you're talking about uranium uh for nuclear power for example in the United States then presumably at some point the obvious partners will be Canada, Australia and Namibia. So it depends on the mineral uh but that formula of seed capital public private partnerships to unlock the private sector investment and in particular we would argue of course working with a company a business like Appen Capital which can find the investors but then because of the equity control we take in the the projects actually deliver it. That's the that's the key. Get the investment, deliver the projects in reasonably uh short order. Um and there not that many players in the market that can do that. So we need to integrate the uh smartly government support and then unlock that private sector investment. And of course we want to see the this done to the very highest standards. Our ESG standards are very high. Um but but at some point final piece of the puzzle for you is we need to get the OEMs on board because a lot of the industrial players the businesses McKenzie report said 15% of OEM leaders would pay a 10% premium for ESG grade critical minerals. So that's a challenge. Um how can we get them on board as well? Because if we don't they will see their cost margins spike in a very short number of years if if not uh months. So, but that those are the elements of the solution. It's a strategic jigsaw. There's no silver bullet, but that's what we need to again uh shift the dial in this context and build those alternative end-to-end supply chains. And again, Appion has been the leader in this. Um since 2016, we bought 12 mining projects into production just by way of benchmark. That's more than the top five mining companies combined. >> Yeah, that's a perfect example. Brazil supplying high-grade graphite to the in in the US, processing in it in Arizona. It's the kind of regional integration policy makers have been really chasing for years. And those projects don't happen without serious money behind them. I mean, between AIANT, the US export import bank and the new mineral security partnership, there's roughly $9 billion in combined public private capital now compi committed to graphite lithium and that nickel supply across the Americas. What's the right balance here? I mean, how much of that heavy lifting should come from governmentbacked funds versus private equity? Where does the line fall between strategic support and and corporate subsidy? >> Yeah, it's a great again great question. Look, I'm a free marketeteer to my core. I don't particularly like government subsidies. On the other hand, you look at that market with the concentration levels and it's a broken market. So, we need to find the right balance. You know, I mentioned the the working model at Aion. We've got a hundred in-house uh miners, uh metallurgists, engineers, geologists, and we look at about a thousand projects each year. But we only really invest in about three, four or five. So that shows you the due diligence done and how many potential projects don't make the grade. But and and it will be because of the fundamental either technical challenges or the economic viability of those projects. What it does also mean is that we got something like 4,000 projects in our database um of nearly projects or projects that we haven't invested in but we've assessed. And I guess the exam question when we talk to governments are what's the the minimum level support that could get those into the kind of place where the commercial appetite would change. Um and it will depend on the project for sure. Um and it will depend on the jurisdiction uh for for sure. But we need a bit more agility. Um and that will mean uh the US, Europe, Australia, Canada reaching out beyond their comfort zones uh working with so-called non-aligned countries. And I mentioned a few of them earlier. >> Yeah. Yeah. I mean, it brings us to the trillion dollar question. Money, right? I mean, there's projects are incredibly capital intensive. Private investors have been somewhat in the past terrified of kind of competing with state subsidized Chinese companies that can manipulate prices and maybe kill a project overnight. But you've been quoted uh as being skeptical that governments have the stomach for floor prices. I mean, the US Department of Defense did exactly that. They just took that 15% equity stake in MP Materials, America's only rare earth minor, and guaranteed a price floor of 110 per kilogram, nearly double the current market price. Has this move, you know, using a a price floor as a geopolitical weapon, changed your view on what's possible? >> Yeah, I think the new administration is certainly hitting the ground with an ambition, a boldness that we haven't seen before. Um, and and that's interesting. I guess uh it's different when it's the Pentagon with a national security imperative uh and the deep pockets that they may have. Um I wouldn't be surprised to see more projects along this line, but I think if you're looking across the whole range and volume of critical minerals required. I don't think you'll see that kind of model um scaled up consistently. Um it's just too expensive. And some people will ask the question, it's a good challenge. um do you end up playing the subsidy game with China which western countries are not going to win because because China can out outdo them for subsidies and I think that's an open question but but I think looking at things with new ideas innovatively and and not having the previous shackles on what we can and can't do is really smart um and there are other things that the new administration have have done um there's uh an interesting question about whether you could create some kind of um uh if you like bespoke market amongst high trust partners where such a flaw price would apply. In the end, you're going to have to think long term and be patient about the capital investments. Um, we've looked uh and articulated ideas for tripartite concepts of uh critical mineral funds and we've talked at different seminars and conferences and to different governments around the world. Um, and so I think the ideas are congealing around the kind of public private partnerships that that that will work with the art of the possible. And I'm very very confident that this can be done. We're not quite ready um uh to announce um uh one of the negotiations we're working on with a major international institution. But we are um we will next week. And what what it what I think we're learning as we go and and other businesses and other governments will be doing the same is the kind of intersect which can uh find and glean the support from government that's required uh and then unlock that private capital. There's some obvious easy wins at home as well. I mean permitting reform the US has got the second slowest uh rate of mine permitting in the world according to S&P Global uh the consultancy. um and Canada and Australia um got similar um not quite as slow but but similar challenges and we don't want to make cut corners with ESG but I think permitting reform is the other obvious thing which should be on the agenda. >> Yeah. Some people forget how long it takes a mine to kind of come into operation. The permitting obviously happens uh if it's quicker like we're seeing down south. I mean, you're describing, let's get back to that bespoke model amongst, you know, trusted partners because nations agreeing to trade critical minerals under that kind of price floor arrangement. I mean, it's an intriguing concept. We're already seeing early hints, right? The US, Australia, critical minerals pact. I mean, we got the EU strategic raw materials club and then Japan's long-term graphite uptake with Brazil. All of which guarantee pricing on on minimum volume clauses. So, are we essentially talking about a new commodity compact like a western OPEC for minerals where trusted allies stabilize prices amongst themselves to kind of counter China's control? >> Uh, I think um there's a difference between if you like floor prices, price fixing and um and other forms of support. Uh but in the end uh if you've got this capex discrepancy, you've got to try and find some ways to incentivize the investments that otherwise wouldn't be made in the jurisdictions where they wouldn't otherwise be made. And I do think you're seeing more collaboration. In the end, what's interesting, I mean, we've saw this with the mineral security partnership under the Biden administration, which I think was um also very well-intentioned. It was quite wide and probably more shallow. What we're seeing now with the new administration, with the so-called transactionalism and uh that that uh the new president brings is actually specific deals. And I do think that's important because in the end we need to start uh uh getting shovels in the ground and getting the process of constructing these mines and these refining projects and indeed these recycling plants uh going and that requires requires seed capital. But look, the more you can collaborate, share that risk, and take a long-term view across a wider pool of high trust partners, the more likely it is that you'll be able to provide the needs that the needs that that that each country has. And remember things like um uh offtake agreements that the the United States clearly wants to try and avoid um offtake for projects that invests uh going to China or being snaffled up. And I'm sure Australia and Canada will be and European Union will be doing the same thing. At the same time, countries will be careful not to avoid not to get lumbered with a whole load of stock that any one point they don't need. Now, the best way to manage that is first of all to lock in the OEMs, but secondly, if you've got a wider range of partners, you can cater for a wider number of countries needs and you bring in a certain degree of flexibility. And that probably is the advantage of a number of countries getting together and trying to create um a a market which avoids the volatility and the outright price manipulation that we're seeing on the open market um at the moment. >> Yeah. Yeah. Well said. Before I let you go, I mean that that government bagging unlocked billions of dollars in private financing from JP Morgan, Goldman Sachs. Now from your seat at Appen Capital, I mean you see this from the investor's side. Is this the new model, a public private partnership where the government takes the geopolitical risk through equity loans and price guarantees so that the private capital can kind of come in and do what it does best? >> Exactly. And what we need to try and do is is take that short-term risk uh out of the investment and to encourage in the patient capital. And uh there's always short-term volatility in the commodity markets of course. Um but given the exponential demand for critical minerals in the way we described at the start of your piece, there's clearly going to be huge demand down the road. And the question is how you lock in the patient capital that is willing to stay with this um and ride out some of the volatility and frankly ride out some of the attempts at price manipulation that we see. Um so so that's that's what I think government can do and help with and and and there's also working with those jurisdictions. I mean there's been talk about DRC, the Ukraine um and other countries around the world which are not exactly um necessarily stable environments or or or for for investment. So again government can come in whether it's through foreign policy, diplomatic assurances, development of infrastructure and even outright security guarantees. Those things can shift the dial. If you think of that 4,000 database of projects that we've got where we passed on investment uh because the commercial appetite couldn't get comfortable with the level of risk. Well, what can government do in each of these areas I've just said to reduce or mitigate that risk? That can certainly unlock some of those projects. >> Yeah. You know, I mean, we got this crisis and and it seems like we have a potential blueprint for a solution and obviously a single project in the US doesn't solve a global problem. But let's talk about the path forward. I mean again, you now advise one of the world's leading private capital investors in mining and you're also chairing a partnership with Safe Center for Critical Mineral Strategy to advise governments on this very issue. I mean, if if you were giving the action plan today to G7 leaders and and CEOs of the world's largest mining houses, what are the top three, you know, things that absolutely must happen now to build that secure western supply chain for strategic metals? So my three would be um seed capital to unlock the private se sector investment. So seed capital from government permitting reform and a hope a hub and spoke model. So onshore when you can Frenchaw when you must. Um those will be my three elements. >> All right Dominic Rab from App and Capital and obviously the World Gold Council joining us today to talk about this critical discussion at a very pivotal moment. I want to thank you for your time and your insights. Uh hopefully we'll have you on soon Dominic. Seems like you're making some great progress here. >> Look forward to it. Thanks for having me on. >> Thanks so much. Appreciate it. All right, that's all for KitKo News. Now, the battle for the world's resources is heating up and we'll be here to cover every angle. Stay with us for more market analysis right here. I'm Jeremy Saffford. We'll see you next time. Heat. Heat.
Ex-UK Deputy PM: A Global Push for Metals is Here, This is the 3-Point Plan to Win
Summary
Transcript
Hey everyone, I'm Jeremy Sappin. Welcome back. All right, gold is seeing some profit taking today after its recent runup past $4,300 on the spot side. But the real story is the volatility shaking every corner of the market. Now, over the past week, we've seen a seismic shock on the global economy because Beijing has weaponized its control over the critical minerals that power. Everything from our phones to fighter jets. Now, the US has threatened 100% tariffs in response, wiping out more than $1.5 trillion dollars from global markets. But just this morning, President Trump told Fox Business those high tariffs are quote not sustainable, adding yet another layer of uncertainty to this crisis. Now, this might not just be a trade war anymore, but a new global conflict over the raw materials of the 21st century. Now, our next guest has been warning about this for years. Dominic Rab is the former deputy prime minister and foreign secretary of the United Kingdom and a year ago he partnered with the world gold council to author the explosive silence is golden report which laid out how the illicit gold trade is used to fund war and terrorism. Now today he sits at the intersection of private capital and geopolitics obviously still with the world gold council but also the head of global affairs at Aion Capital a major private equity firm in the mining sector. Uh Mr. Rab thanks for joining us appreciate your time. Thank you. >> Okay. Well, we got lots to get into today. There's lots obviously hitting the wires, but I want to start with your core area of focus. I mean, a year ago, you partnered with the World Gold Council, friends of ours, obviously we have them on quite often on this report, the silence of of is golden. Now, for our audience, this was an explosive look into the world of artisal and small-scale gold mining, or as we'd like to call them, ASGM. Now, it does account for a massive 20% of the world's gold supply. something I think often our audience forgets and and you detailed how this sector is exploited by criminal networks to fund conflict and terrorism. I got to ask you, I mean, you know, now that a year has passed and gold is of course front and center in headlines, what's the single biggest change that you've seen on the ground? I mean, has that that silent actually been broken? >> Yeah, the silence has been broken. That's uh um fair to say. And look, but this is going to be a big problem and it's going to be a marathon, not a sprint in terms of dealing with it. I had 24 recommendations. I think we're realistic about how long that's going to take. But so one of the big recommendations with more integration across all the different international actors. Well, uh we've launched this coalition for action on ASGM as you rightly referred to it with the UN, the OECD, the World Bank, um and the World Gold Council. And that's really important because there are lots of disperate initiatives. We need to make sure they're integrated. So the law enforcement, the development side, the environmental side are brought together otherwise they work uh in tension if you like. Then drilling down uh to the ground level there's also some important initiatives taking place on the ground. So for example, we're seeing central bank purchasing schemes of gold interlink with artisal gold miners and we want to distinguish between the legitimate uh well-meaning responsible artisal gold miners and give them uh a safe and viable supply chain. Central bank purchasing schemes we've seen in Latin America um uh are an important part of that. We've seen it in Colombia, Ecuador um also Mongolia and the Philippines as well. Um so so that's some progress uh and particularly when it's done in accordance with the London principles which are the world gold council's principles about how those central bank purchasing schemes can be done and and I think it's important to distinguish between them and the responsible ASGM and the predators we we don't want to tile them all with the same brush. The second thing which at ground level I think is really important is on a similar vein. How can we bring the processing uh of um artisal gold to the artisal gold miners on the ground? Because obviously the big major refines and smelters are a long way away. These artisal gold miners may have a birth certificate. The capacity building um that needs to go on around them uh is still significant. So we've seen some local processing plants for ASGM uh Dina uh calls Inca 1 uh plant in Peru which procures ASGM gold uh services Rolex services central bank purchasing schemes similar scheme set up in Tanzania. So I don't want to come on the show with accounts of despair. We have started to see some of the progress. The big thing going on right now for your viewers will be the G20 and the G7. What we'd really like to do is on top of those important initiatives, get this on the agenda and in the resolutions and in the declarations coming out of both the G7, the G20. That gives us a real political shove and a push to get those other recommendations done. >> Yeah. Yeah. Good point. And I mean, obviously a key part of that call to action is that coalition of willing. I mean, you brought it up there, the G7 and G20 nations working together to crack down on these illicit flows. But you know, when we look at the agenda for the upcoming G20 summit in South Africa, the conversation seems to have shifted. I mean, they're talking about value addition, beniction, price stability, not really a coordinated security crackdown. Has that coalition materialized or has the global scramble for strategic metals kind of pushed this security agenda to the back burner? >> Well, we'd love to see the two work in tandem. There's lots of good reasons why they should. Look, the G20s is represents disperate and different views. They're really important because they straddle uh many of the countries where uh ASGM takes place. We know that there have been some real leadership steps forward uh countries like Brazil. I was in Rio at an event with around my report silence is golden and we had everyone from uh members of the Ministry of Defense uh Ministry of Foreign Affairs and those worried about the environmental pollution there. I think there's um a great role for Brazil, a leadership role if you like in all of this. Um it's there's obviously uh the the presidencies um uh under South Africa. We know that they are concerned around this as well. So we haven't yet seen the obviously the full conclusions and declarations but we've been trying to feed in. We want to get it on the agenda. And I think as well there's a virtuous cycle to be done and to be made and to be transformed out of this vicious cycle. If we can get the G20 and the G7 to pay attention and look at all the different aspects, I think you will see it really put rocket boosters under the concrete practical reforms that we need to see. So I remain stubbornly optimistic. >> All right, that's good. Stubbornly optimistic. I mean, Brazil is often cited as kind of that bright spot in the space. It's the new what is it called? the Orolegal Plus program and it's brought what 120,000 artisal miners into formal supply chain since January cutting those mercury use by about 40% according to Brazil's mining ministry. It seems like it's real progress. I'm curious, you know, how scalable is that success outside of Brazil's unique regulatory environment and enforcement capacity? Can this be replicated in Africa or Southeast Asia where governance is is weaker and and corruption seems to run a little deeper? Yeah, you're you're absolutely right to point to that and I do think it's important to point to the good practice because we want to share it and then we create the best practice and then you get that virtuous cycle and Brazil has done some interesting things on law enforcement to go with um the supply chain viability for artisal gold miners. Things like G GPS um uh use uh traceability technology for for gold which is once it's melted down very hard to track across borders. So but but yeah, there's no reason why not. It may require a bit more capacity building which is why G7 development policies to support those countries which host um ASGM will be important but there's no reason why not and um you know Tanzania has uh a local processing a set of set of local processing plants um so so at grassroots level there is action on the ground in that country as well what we need to try and do is is not not try and set up um potential no-go areas. With the right support, with the right political will, uh we can resolve this problem. It won't happen in six weeks. It won't happen in six months. It's going to take years. But I think there is a real sense that the uh technology uh the legal frameworks and the international uh wherewithal is there to actually shift the dial so that you create this virtual cycle where artisal gold miners can uh elevate themselves out of this rut and and plug into a viable supply chain and sell their gold on the market. and along with the law enforcement measures uh that can crowd out the bad actors, the mercenaries, the drug traffickers, Islamic State and al-Qaeda who are oper operating in the Sahel. So yes, I think I think it's all doable with political will and with this uh extra integration at the international level which we're just starting to see. >> Yeah. Yeah. Just starting to see. I mean, you know, your report also championed uh formalization, you know, bringing these smallcale miners into the legal system. And of course, we've seen some positive steps like that new mercury free processing plants in in Peru and Ghana. I mean, we got to be frank, the core problems, corruption complex, licensing, and the lack of, I guess, political will are still as entrenched as ever. And you just kind of talked about it, but I have to ask you, was the vision of formalizing the entire sector on a global scale ever, you know, realistic? We're getting closer. What do you think in timing? >> Yeah, you got to you got to weave in two things. I always think it's doable, right? Um let we we No one makes any progress with a great challenge and this is a great challenge and a great security threat unless we really go in there with some uh confidence that we can get this done. But I think the two things are one the legislative frameworks which we can work with parliaments and national law makers and there are good templates around for doing that and then making it real on the ground and that is where uh and you've got to think an artisal gold miner may not have a birth certificate let alone an app and certainly not the kind of compliance department that a big mining company would obviously have. So um what you need is these local processing plants which in return for some basic rudimentary standards will buy the gold at a reasonable price and then can link into the central bank purchasing schemes. Then you give those artisal miners a positive lifeline. If we can spread the best practice which along with the formalization in the national legal frameworks under underpin and support each other then then then we're with a great shot of shifting the dial and turning the tide on this. >> Yeah. You know when we kind of look at it I mean what's the minimum threshold of of governance capacity or maybe political commitment must a country kind of have before scaling that Brazil style framework that you're talking about? I'm curious which countries today maybe already meet the bar in your eyes. >> Well, I think where look where the the um the the the um the first signatorries to the London principles for the World Gold Council's partnership with the central with central banks. Well, Colombia, Ecuador, the Philippines, Mongolia. Um there is also uh not yet a central bank purchasing scheme but sharing of best practice with Brazil. So these countries can shine a light um and show the way and once you start doing it in practice, you learn each time each um each country is different as you quite rightly said and you learn lessons and then you start to raise the bar and you encourage best practice and you get this snowballing effect, this virtuous cycle. Yes, of course there's there's corruption. We need to try and root that out. That's um that's a great challenge. There's in um Latin America, there's a big problem with the drug trafficking cartels as they look to diversify away from cocaine. And obviously in countries like the Central African Republic, uh there's a a fundamental security problem which is how the Vagna Group got in there in the first place, a sort of Fouian bargain where they traded um in return for security services from from the Vagnner group access to their artisal gold mining um uh resources. that that clearly is something that we've got to to tackle and I've set out um specific recommendations to deal with it. But I think uh if you look at the whole package of measures um and you look at the whole mountain that we've got to climb, it looks pretty daunting. But step by step, every time a country introduces some reform, whether it's their legal frameworks through legislation, whether it's one of these local processing uh plants, we make we make a step forward. Uh, and that's bad news for the bad actors because they can't thrive in those areas. So, it'll take uh baby steps along the way, but step by step, I'm confident that we can get there. >> Yeah. And leading by example, too. Uh, okay. Well, we got to pivot now from the specifics of artisal gold to the broader hunt for metals because the security issues that you raised in your report a year ago now seem to be playing out on a global strategic scale. I mean, back in October 9th, Beijing moved to control that entire value chain for rare earths, restricting technology and personnel, even trace amounts of finished product. The US responded with that threat of 100% tariffs, though President Trump is now walking that back, saying it's not sustainable. From your perspective, as a, you know, former secretary, I mean, is this just another round of trade war posturing or or does this signal a fundamental rupture in the global economic order here? >> Yeah, it's a great challenge. Look, first of all, this is not um notwithstanding the news around uh the new export controls on rare earths from Beijing. This has been a challenge building up for 20 years. China has concentration of the market 60 70 if you include the refining and processing of rare earth and other uh critical minerals like graphite, you're talking upwards of 90%. Um so and this has been a long time coming. China has a very concerted plan. they've stuck at it for many years. Um, and they use all the tools of a command economy to build up that concentration. Um, and uh, there's exponential demand for all of these critical minerals, whether it's for the copper for data centers, the cobalt for our smartphones, the lithium for our EV batteries, and increasingly the defense requirements, whether it's missile defense or fighter jets. Um so there's a exponential demand and a chokeold over supply. The the the question is how do we build up the alternative supply chains uh to get around these trade restrictions particularly the export controls and I think there's two things that are critically important. um one is better public private partnerships so that governments can provide the kind of support in particular financial support but other other things like permitting of mining projects that can encourage and unlock the investment. The second thing is we hear a lot of talk about onshoring and it's it's clearly important. It's true in the United States. European Union is doing something similar. Canada and Australia hum to a similar sort of tune albeit um slightly different context. But um I think we need a hub and spoke model where countries on shore when they can but French shore with high trust partners where they must. Rar is a great example of it and you look at Brazil and Vietnam that's something like 37% of global supply right there. Uh we have at Appian Capital we have Gibsland Critical Minerals which um is got the potential to supply 7% global supply. We've got a processing uh plant in um Virginia Atlantic Strategic Minerals which can do in due course some of the refining and processing for that. So what I'm saying is that you've got to put these links together and where uh countries can't do it alone team up with these high trust partnerships and a combination of public private partnerships with business with investors and the strategic friend shoring that is the way that we can provide the range and the depth of um supply in all of these areas that the US Europe needs Australia Canada as well. Yeah, very interesting on the French shoring. Uh, we got to get into that topic, but before we do, I mean, you recently wrote that the West has kind of been asleep at the wheel on on the issue. I mean, China now controls nearly 90% of rare earth processing, and their new rule could mean that if a, you know, an F-35 fighter jet or a Tesla built in Texas could effectively require a Chinese export license to be sold. I mean, you talked about that last 20 years, how this isn't new. I'm curious, how did the West allow this level of strategic dependency to happen? You know, I always think of President Eisenhower's famous quip in the 50s that he's got serious problems and urgent problems, but the urgent problems aren't serious and the serious problems aren't urgent. It's a general I think it's a genuine challenge. Um I'm not sort of pessimistic about the prospects for um liberal democracies in the West at all. But we got to play to our strengths and one of our vulnerabilities is we just think too short term as the Eisenhower quip shows. So we've got to do some some straightforward things like learn how to plan longer term. Um certainly in mining projects whether it's the extraction or the refining and the processing is a great challenge to get patient capital invested in. So we need governments to provide seed capital. You see with the US administration and the mounted pass deal which has had so much commentary rare earth's um project with the department for war uh the Pentagon investing in uh providing a floor price at double market value for rare earth taking a 50% equity stake in that company. Um so that's a good example of onshoring if we're going to deal with the range and the volume required that's going to have to be expanded more generally. I I'm you know it's it's open for debate whether floor um prices at at that level are sustainable across the piece but I think it's a very bold first step and um and one way or another we need to level the the playing field for for cap capital expenditure which China has a head start and a huge advantage because again of that command economy and the subsidies that they'll avail themselves of. So we're certainly starting to see the west wake up. I think the the new US administration has come in with some really interesting um initiatives. Exim uh bank which is the US export import bank is now more inclined to finance projects abroad where there's offtake and supply chain security at home. Uh that's another example and we're working with all governments around the world. We've talked to the US about what those public private partnerships can look like. Um so we've got some conceptual ideas. We need to unlock that private sector investment, but we also we also need to recognize this isn't a free market. And we need to try and sustain, to go back to your original point, the kind of staying power, if you like, commercially and politically that uh has has left us so far behind China. >> I like that. I like that long-term thinking point because we're so often thinking about just, you know, the next quarter and and it brings us to that friend shoring that you're talking about building supply chains through allied nations. I mean, we've seen it kind of fail before, right? The West has backed rare earth projects in places like Brazil only to see the raw material still end up going to China for processing because that's where the refineries are. How do you build the entire value chain from mine to magnet without China? And in which countries are kind of the key players on this new geopolitical chessboard? >> So, it's a great challenge. Um, let me give you one concrete example to see how show you how it's done. We we own a company called Graphcoa in Brazil produces high-grade graphite. Um we also then own uh a company called Herbix in um Arizona which processes it and thereby feeds the EV market in North America. Um there's some financial support that we're hoping to see confirmed shortly. Um but that also involves French shoring. Now, Brazil's got a huge amount of natural resource in this area. Um, and I mentioned rare earth as well as graphite. There are other countries and the Philippines, Chile, Argentina, Saudi Arabia wants to uh not just invest in this space, but also do some of the refining and the processing uh and probably has cheaper energy costs and easier permitting than in other countries. If you're talking about uranium uh for nuclear power for example in the United States then presumably at some point the obvious partners will be Canada, Australia and Namibia. So it depends on the mineral uh but that formula of seed capital public private partnerships to unlock the private sector investment and in particular we would argue of course working with a company a business like Appen Capital which can find the investors but then because of the equity control we take in the the projects actually deliver it. That's the that's the key. Get the investment, deliver the projects in reasonably uh short order. Um and there not that many players in the market that can do that. So we need to integrate the uh smartly government support and then unlock that private sector investment. And of course we want to see the this done to the very highest standards. Our ESG standards are very high. Um but but at some point final piece of the puzzle for you is we need to get the OEMs on board because a lot of the industrial players the businesses McKenzie report said 15% of OEM leaders would pay a 10% premium for ESG grade critical minerals. So that's a challenge. Um how can we get them on board as well? Because if we don't they will see their cost margins spike in a very short number of years if if not uh months. So, but that those are the elements of the solution. It's a strategic jigsaw. There's no silver bullet, but that's what we need to again uh shift the dial in this context and build those alternative end-to-end supply chains. And again, Appion has been the leader in this. Um since 2016, we bought 12 mining projects into production just by way of benchmark. That's more than the top five mining companies combined. >> Yeah, that's a perfect example. Brazil supplying high-grade graphite to the in in the US, processing in it in Arizona. It's the kind of regional integration policy makers have been really chasing for years. And those projects don't happen without serious money behind them. I mean, between AIANT, the US export import bank and the new mineral security partnership, there's roughly $9 billion in combined public private capital now compi committed to graphite lithium and that nickel supply across the Americas. What's the right balance here? I mean, how much of that heavy lifting should come from governmentbacked funds versus private equity? Where does the line fall between strategic support and and corporate subsidy? >> Yeah, it's a great again great question. Look, I'm a free marketeteer to my core. I don't particularly like government subsidies. On the other hand, you look at that market with the concentration levels and it's a broken market. So, we need to find the right balance. You know, I mentioned the the working model at Aion. We've got a hundred in-house uh miners, uh metallurgists, engineers, geologists, and we look at about a thousand projects each year. But we only really invest in about three, four or five. So that shows you the due diligence done and how many potential projects don't make the grade. But and and it will be because of the fundamental either technical challenges or the economic viability of those projects. What it does also mean is that we got something like 4,000 projects in our database um of nearly projects or projects that we haven't invested in but we've assessed. And I guess the exam question when we talk to governments are what's the the minimum level support that could get those into the kind of place where the commercial appetite would change. Um and it will depend on the project for sure. Um and it will depend on the jurisdiction uh for for sure. But we need a bit more agility. Um and that will mean uh the US, Europe, Australia, Canada reaching out beyond their comfort zones uh working with so-called non-aligned countries. And I mentioned a few of them earlier. >> Yeah. Yeah. I mean, it brings us to the trillion dollar question. Money, right? I mean, there's projects are incredibly capital intensive. Private investors have been somewhat in the past terrified of kind of competing with state subsidized Chinese companies that can manipulate prices and maybe kill a project overnight. But you've been quoted uh as being skeptical that governments have the stomach for floor prices. I mean, the US Department of Defense did exactly that. They just took that 15% equity stake in MP Materials, America's only rare earth minor, and guaranteed a price floor of 110 per kilogram, nearly double the current market price. Has this move, you know, using a a price floor as a geopolitical weapon, changed your view on what's possible? >> Yeah, I think the new administration is certainly hitting the ground with an ambition, a boldness that we haven't seen before. Um, and and that's interesting. I guess uh it's different when it's the Pentagon with a national security imperative uh and the deep pockets that they may have. Um I wouldn't be surprised to see more projects along this line, but I think if you're looking across the whole range and volume of critical minerals required. I don't think you'll see that kind of model um scaled up consistently. Um it's just too expensive. And some people will ask the question, it's a good challenge. um do you end up playing the subsidy game with China which western countries are not going to win because because China can out outdo them for subsidies and I think that's an open question but but I think looking at things with new ideas innovatively and and not having the previous shackles on what we can and can't do is really smart um and there are other things that the new administration have have done um there's uh an interesting question about whether you could create some kind of um uh if you like bespoke market amongst high trust partners where such a flaw price would apply. In the end, you're going to have to think long term and be patient about the capital investments. Um, we've looked uh and articulated ideas for tripartite concepts of uh critical mineral funds and we've talked at different seminars and conferences and to different governments around the world. Um, and so I think the ideas are congealing around the kind of public private partnerships that that that will work with the art of the possible. And I'm very very confident that this can be done. We're not quite ready um uh to announce um uh one of the negotiations we're working on with a major international institution. But we are um we will next week. And what what it what I think we're learning as we go and and other businesses and other governments will be doing the same is the kind of intersect which can uh find and glean the support from government that's required uh and then unlock that private capital. There's some obvious easy wins at home as well. I mean permitting reform the US has got the second slowest uh rate of mine permitting in the world according to S&P Global uh the consultancy. um and Canada and Australia um got similar um not quite as slow but but similar challenges and we don't want to make cut corners with ESG but I think permitting reform is the other obvious thing which should be on the agenda. >> Yeah. Some people forget how long it takes a mine to kind of come into operation. The permitting obviously happens uh if it's quicker like we're seeing down south. I mean, you're describing, let's get back to that bespoke model amongst, you know, trusted partners because nations agreeing to trade critical minerals under that kind of price floor arrangement. I mean, it's an intriguing concept. We're already seeing early hints, right? The US, Australia, critical minerals pact. I mean, we got the EU strategic raw materials club and then Japan's long-term graphite uptake with Brazil. All of which guarantee pricing on on minimum volume clauses. So, are we essentially talking about a new commodity compact like a western OPEC for minerals where trusted allies stabilize prices amongst themselves to kind of counter China's control? >> Uh, I think um there's a difference between if you like floor prices, price fixing and um and other forms of support. Uh but in the end uh if you've got this capex discrepancy, you've got to try and find some ways to incentivize the investments that otherwise wouldn't be made in the jurisdictions where they wouldn't otherwise be made. And I do think you're seeing more collaboration. In the end, what's interesting, I mean, we've saw this with the mineral security partnership under the Biden administration, which I think was um also very well-intentioned. It was quite wide and probably more shallow. What we're seeing now with the new administration, with the so-called transactionalism and uh that that uh the new president brings is actually specific deals. And I do think that's important because in the end we need to start uh uh getting shovels in the ground and getting the process of constructing these mines and these refining projects and indeed these recycling plants uh going and that requires requires seed capital. But look, the more you can collaborate, share that risk, and take a long-term view across a wider pool of high trust partners, the more likely it is that you'll be able to provide the needs that the needs that that that each country has. And remember things like um uh offtake agreements that the the United States clearly wants to try and avoid um offtake for projects that invests uh going to China or being snaffled up. And I'm sure Australia and Canada will be and European Union will be doing the same thing. At the same time, countries will be careful not to avoid not to get lumbered with a whole load of stock that any one point they don't need. Now, the best way to manage that is first of all to lock in the OEMs, but secondly, if you've got a wider range of partners, you can cater for a wider number of countries needs and you bring in a certain degree of flexibility. And that probably is the advantage of a number of countries getting together and trying to create um a a market which avoids the volatility and the outright price manipulation that we're seeing on the open market um at the moment. >> Yeah. Yeah. Well said. Before I let you go, I mean that that government bagging unlocked billions of dollars in private financing from JP Morgan, Goldman Sachs. Now from your seat at Appen Capital, I mean you see this from the investor's side. Is this the new model, a public private partnership where the government takes the geopolitical risk through equity loans and price guarantees so that the private capital can kind of come in and do what it does best? >> Exactly. And what we need to try and do is is take that short-term risk uh out of the investment and to encourage in the patient capital. And uh there's always short-term volatility in the commodity markets of course. Um but given the exponential demand for critical minerals in the way we described at the start of your piece, there's clearly going to be huge demand down the road. And the question is how you lock in the patient capital that is willing to stay with this um and ride out some of the volatility and frankly ride out some of the attempts at price manipulation that we see. Um so so that's that's what I think government can do and help with and and and there's also working with those jurisdictions. I mean there's been talk about DRC, the Ukraine um and other countries around the world which are not exactly um necessarily stable environments or or or for for investment. So again government can come in whether it's through foreign policy, diplomatic assurances, development of infrastructure and even outright security guarantees. Those things can shift the dial. If you think of that 4,000 database of projects that we've got where we passed on investment uh because the commercial appetite couldn't get comfortable with the level of risk. Well, what can government do in each of these areas I've just said to reduce or mitigate that risk? That can certainly unlock some of those projects. >> Yeah. You know, I mean, we got this crisis and and it seems like we have a potential blueprint for a solution and obviously a single project in the US doesn't solve a global problem. But let's talk about the path forward. I mean again, you now advise one of the world's leading private capital investors in mining and you're also chairing a partnership with Safe Center for Critical Mineral Strategy to advise governments on this very issue. I mean, if if you were giving the action plan today to G7 leaders and and CEOs of the world's largest mining houses, what are the top three, you know, things that absolutely must happen now to build that secure western supply chain for strategic metals? So my three would be um seed capital to unlock the private se sector investment. So seed capital from government permitting reform and a hope a hub and spoke model. So onshore when you can Frenchaw when you must. Um those will be my three elements. >> All right Dominic Rab from App and Capital and obviously the World Gold Council joining us today to talk about this critical discussion at a very pivotal moment. I want to thank you for your time and your insights. Uh hopefully we'll have you on soon Dominic. Seems like you're making some great progress here. >> Look forward to it. Thanks for having me on. >> Thanks so much. Appreciate it. All right, that's all for KitKo News. Now, the battle for the world's resources is heating up and we'll be here to cover every angle. Stay with us for more market analysis right here. I'm Jeremy Saffford. We'll see you next time. Heat. Heat.