Resource security isn't achieved by locking up commodities

We must strike at the root of resource insecurity, by demateralising our economy where we can.

Last week, Chatham House added to the drumbeat of concern about resources, declaring that "the spectre of resource insecurity has come back with a vengeance." In its dense, persuasive report, Resource futures (pdf), Chatham House's researchers diagnose the problems posed by increasing resource insecurity in detail, systematically identifying the causes of insecurity. This is an expansive analysis, and a major achievement, but the recommendations made in the report have the air of the outcomes of international climate talks: frameworks and processes to find solutions rather than actual solutions.

In researching the existing literature on material security as part of our work for the Circular Economy Task Force, we at Green Alliance have found that much of the debate about resource security has focused on two factors: raw material price volatility and the risk that international trade of raw materials will be restricted by nation states.

This reductionist framing of material security risk has artificially narrowed thinking about the underlying risks which foster price volatility and restricted access to materials. This, in turn, has limited the options we use to mitigate these risks.

Focusing on political risk has led to responses like land banking, in which countries and companies directly purchase foreign land to serve their resource needs; and raw material agreements, where countries sign contracts to trade raw material supplies for technology or infrastructure development. China, Japan, and Germany have all pursued these strategies in the last two years, for a wide variety of commodities ranging from food to metals.

Resource futures notes these developments and rightly shows how these and similar policies, including production subsidies, the actions of state owned enterprises, and market manipulation, have "fuelled the fire" of resource insecurity. It is clear that these strategies also have social drawbacks, but they are more fundamentally flawed because they deal with the symptoms of insecure resources, not the causes.

Getting to the bottom of price volatility and restrictions on raw material trade means understanding more about why we can't simply meet growing demand for resources the way we did in the 20th century: by expanding extraction. Absolute scarcity is rarely a hard limit. But across a whole host of materials, the rising environmental costs of production are a big part of the reason for volatile prices and restrictions on access to materials. Resource futures dissects these causes in discussion about "environmental faultlines", the "interconnected nature of the resource production system," and the risks embedded in the push to extract resources from "extreme environments" like the Arctic.

Chatham House has done a major service in moving debate on material security from symptoms to causes. But the juggernaut runs into the sand when it comes to recommendations, which stress that "collaborative governance is the only option" and prescribe rule-based resource governance, informal stakeholder dialogues, and multilateralism.

The report itself admits that "success to date [of political responses] has been patchy" for timber, "unsuccessful" for agricultural export restrictions, and "largely unsuccessful" in tackling price volatility for resources from oil to tin. It should come as no surprise that countries have therefore relied on unilateral measures which are politically insecure. The reasons for this, put simply, are that foreign land ownership or exclusive supply contracts merely cut the global resource cake into different slices, with larger proportions going to countries willing to pay, contract, or fight for a larger share of resources than they control within their borders. This enforced inequality isn't a durable solution. Ownership, contracts, and commitment to free markets fall by the wayside when resource prices spike, as examples like the restriction on Argentinian beef exports in 2006 – hardly a scarce commodity – show.

Multilateral governance is better, but it's not clear that it isn't just an attempt more fairly cut up the same cake. And this is the problem: Chatham House's analysis that the "fundamental conditions that gave rise to tight markets in the last ten years remain" means that their recommendations pit diplomacy against raw resource nationalism. As their own evidence shows, diplomacy hasn't succeeded in this struggle so far. It"s not clear why diplomacy will now succeed in "mitigat[ing] excessive politicization of resource markets and trade" in "markets [that] have always been political."

The truth is that multilateralism isn't enough. We must strike at the root of resource insecurity, by demateralising our economy where we can, but also by finding sources of raw materials which avoid the environmental risks underlying material insecurity. The circular economy represents one way of doing this. It's still more of a good idea than a plan of action, but without it we're stuck merely managing resource insecurity, rather than solving it.

A smelter shovels raw iron on a blast furnace in Germany. Photograph: Getty Images

Dustin Benton is a senior policy adviser at Green Alliance, leading the Resource Stewardship theme.

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Leave campaigners are doing down Britain's influence in Europe

As the third biggest country, Britain has huge clout in the EU.

Last week the Leave campaign's Priti Patel took to the airwaves to bang on about the perils of EU regulation, claiming it is doing untold damage to small businesses in the UK. Let's put aside for one minute the fact that eight in ten small firms actually want to stay in the EU because of the huge benefits it brings in terms of trade and investment. Or the fact that the EU has cut red tape by around a quarter in recent years and is committed to doing more. Because the really startling thing Patel said was that these rules come to us "without the British government having a say." That might be forgivable coming from an obscure backbencher or UKIP activist. But as a government minister, Priti Patel knows full well that the UK has a major influence over all EU legislation. Indeed, she sits round the table when EU laws are being agreed.

Don't take it from me, take it from Patel herself. Last August, in an official letter to the House of Lords on upcoming EU employment legislation, the minister boasted she had "worked closely with MEPs to influence the proposal and successfully protected and advanced our interests." And just a few months ago in February she told MPs that the government is engaging in EU negotiations "to ensure that the proposals reflect UK priorities." So either she's been duping the Parliament by exaggerating how much influence she has in Brussels. Or, as is perhaps more likely, she's trying to pull the wool over the British people's eyes and perpetuate a favourite myth of the eurosceptics: that the UK has no say over EU rules.

As the third biggest country, Britain has huge clout in Europe. We have the most votes in the EU Council alongside France, Germany and Italy, where we are on the winning side 87 per cent of the time. The UK also has a tenth of all MEPs and the chairs of three influential European Parliament committees (although admittedly UKIP and Tory sceptics do their best to turn their belief the UK has no influence in Europe into a self-fulfilling prophecy). UKIP MEPs aside, the Brits are widely respected by European counterparts for their common sense and expertise in areas like diplomacy, finance and defence. And to the horror of the French, it is English that has become the accepted lingua franca in the corridors of power in Brussels.

So it's no surprise that the UK has been the driving force behind some of the biggest developments in Europe in recent decades, including the creation of the single market and the enlargement of the EU to Eastern Europe. The UK has also led the way on scrapping mobile roaming charges from next year, and is now setting the agenda on EU proposals that will make it easier to trade online and to access online streaming services like BBC iPlayer or Netflix when travelling abroad. The irony is that the Europe of today which Eurosceptics love to hate is very much a British creation.

The Leave campaign like to deride anyone who warns of the risks of leaving the EU as "talking down Britain." But by denying the obvious, that the UK has a major role in shaping EU decisions, they are the ones guilty of doing our country down. It's time we stood up to their defeatist narrative and made the case for Britain's role in Europe. I am a proud patriot who wants the best for my country, and that is why like many I will be passionately making the case to remain in the EU. Now is not the time to leave, it's time to lead.