UK allows use of export finance to secure critical minerals

UK Export Finance can provide financial support for overseas projects that source critical minerals for use in UK industries.

The Chancellor has announced that UK Export Finance (UKEF), the government’s export credit agency, will offer financial support for overseas projects that supply critical minerals fuelling UK industrial growth and the net-zero transition. It is hoped that this will help the UK to build economic resilience and lower the risk of supply-chain disruption in major industries.

Financing will be offered in the form of credit guarantees to overseas companies, helping them access debt financing for projects which supply UK exporters with critical mineral products – including both raw and processed materials.  

It is expected that UKEF will work with other ECAs and public financial institutions to finance eligible projects and support investment into new supply routes. 

This would make it easier for UK manufacturers to secure contracts with critical mineral suppliers in countries with large mineral deposits.

A list of critical minerals has been defined by the British Geological Survey in the UK Critical Minerals Strategy (first published in 2021). UKEF will be able to finance projects supporting UK imports of these minerals.

According to the Critical Minerals Intelligence Centre, the following sectors have supply chains that are vulnerable to a shortage of critical minerals:

• Batteries
• Wind turbines
• Traction motors
• Electrolysers (hydrogen)
• Heat pumps
• Photovoltaics
• Fuel cells
• Nuclear

This funding was announced in the Autumn Budget, see the IOM3 response here.