The European Union’s plans to expand its defence capabilities are being hindered by China’s export controls and sales restrictions on critical raw materials.

In response, EU leaders are urging member states to accelerate efforts to diversify supply chains.

According to Nikkei Asia, the European Commission announced last week that it would propose new legislation requiring companies across the bloc to broaden their supplier base in an effort to address economic imbalances, although it did not explicitly name China.

The war in Ukraine and growing uncertainty over Washington’s security guarantees have pushed European governments to increase military spending and defence production.

At the same time, according to a report published in May by Joris Teer, a policy analyst at the European Union Institute for Security Studies (EUISS), China accounts for at least 70% of global mining or refining activity in 17 of the 34 materials classified as critical by the EU. Eight of those 34 materials are currently subject to Chinese export controls.

“China is undermining Europe’s rearmament efforts,” Teer wrote. “Simply by activating this tool, China has already increased its leverage and demonstrated both the capability and willingness to restrict supply whenever it chooses.”

The Aerospace, Security and Defence Industries Association of Europe also warned that geopolitical developments and intensifying global competition for critical raw materials are further underscoring the need to strengthen European supply chains.

The organisation represents more than 4,000 companies, including Britain’s BAE Systems, France’s Thales and Germany’s Rheinmetall.

European defence manufacturers are pursuing a range of strategies, including vertical integration, recycling, diversification and stockpiling.

Rheinmetall told Nikkei Asia that it has “no dependencies” and is “well prepared” regarding critical minerals.

A company spokesperson said: “Rheinmetall has stockpiled key raw materials sufficient for several years. We have also implemented IT systems that allow us to centrally monitor and precisely manage raw material consumption across the entire group.”

Analysts, however, caution that stockpiling alone will not be sufficient. Maria Shagina, a researcher at the International Institute for Strategic Studies, said: “Stockpiling serves as an important buffer against sudden disruptions, but on its own it is unlikely to mitigate structural damage over the long term.”

Shagina added that replacing the volume and diversity of critical minerals controlled by Beijing with alternative sources would take years.

In 2024, the EU enacted the European Critical Raw Materials Act, aimed at rebuilding domestic supply chains for such minerals.

The legislation sets 2030 targets for domestic extraction, processing and recycling while limiting dependence on any single third-country supplier to 65%.

A €3 billion ($3.5 billion) fund was established last year to accelerate strategic projects.

Nevertheless, the European Court of Auditors has noted that the 2030 targets are not legally binding and that the EU remains far from achieving them.

Industry groups argue that policy inconsistencies could further slow progress.

The Cobalt Institute, which represents a sector vital to jet engines, advanced batteries and defence alloys, warned that proposed EU chemicals regulations risk undermining the industry.

“Europe has one foot in and one foot out,” said Michael Blakeney, head of government and public affairs at the London-based institute. “It says the right things, but its actions are inconsistent.”

Europe’s efforts are unfolding alongside a more aggressive US strategy to secure critical mineral supply chains.

Shagina said:

“The US is investing more capital to secure and expand capacity, taking greater financial risks and, in some cases, acquiring equity stakes. Europe, by contrast, is generally more cautious, which places it at a relative disadvantage in the competition for critical minerals.”

In April, the EU signed an agreement with the United States to coordinate supplies of critical minerals. Although some member states initially resisted over concerns that the deal could weaken the bloc’s strategic autonomy, they authorised the Commission in early June to join the US-led “Pax Silica” initiative, which coordinates investment and export-control policies.

Teer urged Europe to use ongoing US-EU-Japan negotiations as the nucleus of a broader coalition aimed at making critical mineral production outside China financially viable through state support, minimum-price mechanisms and supply rules.

“Particularly important are countries that either produce raw materials or possess significant mineral deposits, such as Malaysia, the Democratic Republic of the Congo, Brazil and Indonesia, as well as countries like India with large pools of skilled labour,” he said.

Teer also argued that the EU should activate its Anti-Coercion Instrument, which allows the bloc to impose tariffs and restrictions in response to economic pressure on countries outside the union, in order to deter China from introducing further restrictions.

A European Commission spokesperson said the bloc had “long been aware of the risks associated with the EU’s dependence on critical raw materials.”

“The objective is clear: to anticipate disruptions early and reduce the EU’s vulnerabilities while strengthening our industrial and defence capacities,” the spokesperson said.

European countries are increasingly tightening their citizenship rules. Most recently, the Norwegian government has drafted legislation that would raise the minimum residency requirement for citizenship from three years to seven.

The proposed amendments to the citizenship law were presented by the Ministry of Labour and Social Inclusion.

Under the draft legislation, stateless individuals born in Norway, as well as those who arrived in the country as children, would be required to reside in Norway for at least five years before becoming eligible for citizenship.

The government also plans to increase residency requirements for foreign nationals who are married to or cohabiting with Norwegian citizens.

Language requirements are set to become more demanding as well. The proposal would raise the required level of spoken Norwegian proficiency from A2 to B1. The new rules would apply to applicants aged between 18 and 67.

Commenting on the changes, Minister of Labour and Social Inclusion Kjersti Stenseng said: “Obtaining and holding Norwegian citizenship should be a privilege.”

The government argues that simplifying administrative procedures while simultaneously tightening eligibility criteria will help reduce the country’s large backlog of pending applications and shorten processing times.

Norway is the latest European country to announce revisions to its citizenship rules.

In Finland, the minimum residency requirement for citizenship was increased from five years to eight years on October 1, 2024.

The country also plans to introduce a mandatory citizenship test for applicants aged between 18 and 64 from the beginning of 2027.

Finnish Interior Minister Mari Rantanen said: “The introduction of a citizenship test is the final component of a comprehensive reform aimed at making citizenship requirements more stringent.”

Sweden has also approved a similar reform. Beginning in June 2026, the standard residency requirement for citizenship will increase from five years to eight years. Authorities are also introducing a financial self-sufficiency requirement for applicants and expanding the scope of security screenings.

Explaining the rationale behind the changes, Migration Minister Johan Forssell said: “It was possible to become a citizen after living in the country for five years without knowing a single word of Swedish, learning anything about Swedish society, or even having one’s own source of income.”

The most far-reaching changes have been implemented in Portugal. Portuguese President Antonio Jose Seguro has signed legislation raising the minimum residency requirement for citizenship from five years to 10 years.

For citizens of the European Union and the Community of Portuguese Language Countries, the requirement has been set at seven years.

The residency period will now be calculated from the date a residence permit is granted rather than from the date a citizenship application is submitted. The new rules will also affect the children of immigrants.

Previously, children could obtain citizenship one year after birth if their parents held residence permits. Under the new rules, at least one parent must have legally resided in the country for a minimum of five years.

The law also introduces a mandatory examination covering Portuguese history, culture, values and social structures.

Migration policies are tightening across the European Union as well. On June 17, the European Parliament approved legislation allowing irregular migrants whose asylum applications have been rejected but who cannot be returned to their countries of origin to be deported to third countries.

The new EU rules permit the establishment of migrant detention centres outside the bloc’s borders. African countries are reportedly among the options being discussed for such facilities.

SpaceX has sharply criticised a European Union plan to restrict access to satellite spectrum, arguing that the proposal risks degrading connectivity in Ukraine and disrupting emergency communications services.

In a document shared with European officials and reviewed by the Financial Times, SpaceX warned:

“This proposal significantly increases the likelihood that Europeans will be deprived of direct-to-device satellite services, or that new European operations will create global interference issues, including for emergency services such as those operating in Ukraine.”

In a proposal unveiled in May, the EU recommended reserving part of the spectrum band used for direct satellite-to-smartphone connectivity for European operators, thereby limiting the frequencies available to US and Chinese providers.

The 2 GHz frequency band in question is currently used by two US companies, Viasat and EchoStar.

SpaceX argued that the EU plan prioritises “an operator’s country of establishment over economic, technical and regulatory realities.”

When the proposal was announced, EU technology chief Henna Virkkunen defended the move, saying the bloc wanted to “increase European capacity in this sector.” She added that other parts of the frequency band would remain open to international operators, arguing that prioritising European providers was justified.

Other participants involved in discussions over the proposal said some EU officials were specifically seeking to limit Elon Musk’s Starlink satellite network.

Europe’s initiative follows a warning from Washington. In March, the US Federal Communications Commission (FCC) cautioned that it could take retaliatory measures if the EU chose to favour European satellite operators over alternatives such as Starlink.

At the time, FCC Chairman Brendan Carr told the Financial Times: “Some of the discussions in Europe regarding satellite sovereignty concern us. If Europe decides to move down that path, then, as you know, we will have to consider reciprocal measures.”

The European Commission’s proposal has not yet entered formal negotiations with EU member states or the European Parliament.

A source close to SpaceX said the company remained hopeful of influencing the outcome of the process, given concerns raised by both businesses and several European governments.