Mineral diplomacy in the age of AI

On his whirlwind summer tour of the Americas, South Korean President Lee Jae-myung focused heavily on trade and economic cooperation in the technology industry. In the US, he spoke of 'AI sales diplomacy' to industry executives in Silicon Valley. But south of the equator, his focus was more on obtaining access to the raw materials needed to power the AI boom he was selling.

South Korea is in the midst of a massively beneficial moment for its semiconductor industry. The country is home to two of the biggest manufacturers of high-bandwidth memory chips, SK Hynix and Samsung, which are making money hand over fist thanks to the skyrocketing demand for these components, crucial for the manufacturing of AI processors and GPUs.

But making semiconductors requires vast supplies of critical minerals such as copper, lithium, and rare earth elements (REEs). The country's economic future is in the making today, and Seoul is now looking to Latin America to make the most of the moment.

The new resource competition

China dominates significant parts of the world's critical-mineral processing and rare-earth supply chains, controlling roughly 85% of refining capacity. So a country can have large mineral deposits but may not be able to turn those resources into the refined materials needed for batteries, electronics, magnets, and the like.

For South Korea, which relies heavily on imports, this creates a vulnerability: Even if it secures raw materials from new suppliers, it still must depend on a concentrated group of countries for their processing.

Securing minerals is thus only the first step. Mining projects can take years to develop, and processing, refining, transportation, and manufacturing can all turn into bottlenecks. Countries competing for resources therefore increasingly need to consider the entire value chain, rather than simply signing agreements to access deposits.

Building out supply chains

For resource-rich countries, foreign investment provides an opportunity to capture more of the economic value generated by rising demand. Brazil, for one, has substantial rare-earth and other critical-mineral resources, but mining can't on its own create an industrial supply chain. Processing ores into higher-value materials and using them to manufacture components can generate far more economic value than exporting unprocessed material.

That distinction is reflected in South Korea and Brazil's agreement, which emphasises local processing and value creation. Lee also said in Sao Paulo that critical-mineral supply chains were an area where the two countries could achieve greater cooperation.

Chile presents a different opportunity. Its enormous copper and lithium resources give South Korea access to minerals already central to the global energy and technology economy. Korea, meanwhile, brings expertise in advanced manufacturing, batteries, and semiconductors.

The potential relationship is therefore less about a simple buyer-seller transaction and more about linking resource production with industrial capacity. But for South Korea, that makes diversification more complicated than signing agreements with new suppliers. The country will have to invest across multiple stages of the chain and develop relationships that can withstand disruptions to any one part of it.

The capital bottleneck

This dynamic is one I see from the inside. At AMR Resources, our work connecting junior mining and resource assets to public capital markets exists precisely because of the gap Korea is now confronting at a national level: a promising deposit is worthless without the capital, expertise, and market access needed to carry it from discovery to production.

The same value-chain thinking driving South Korea's resource diplomacy is what resource-stage investors and acquirers have to apply deal by deal – identifying where an asset sits in that chain, and what it actually takes to move it to the next stage. Sovereign strategies and private capital are converging on the same insight: securing the rock in the ground is the easy part.

A race on many fronts

The AI race is in some ways also a race to the mines and refineries. The countries that emerge as technology leaders will be the ones that manage to build resilient, diversified, and transparent supply chains that connect mines to processors, manufacturers, and ultimately, the components that power the technologies transforming the global economy.

South Korea's simultaneous focus on Silicon Valley and South America's mineral deposits offers an early glimpse of this new industrial geography. AI may be digital, but the infrastructure behind it is physical. And as governments compete to build the technologies of the future, access to the minerals beneath the ground is becoming inseparable from access to the industries built above it.

Read the article online at: https://www.globalminingreview.com/special-reports/09102026/mineral-diplomacy-in-the-age-of-ai/