Industrial power today is defined not only by factories, engineers, or capital, but by access to critical raw and processed materials that underpin modern economies. While Europe’s midstream processing vulnerabilities are well known, a new layer is emerging: the strategic geography of Southeast Europe (SEE).
SEE—including Serbia, Montenegro, North Macedonia, Bosnia & Herzegovina, Albania, Kosovo, and parts of Bulgaria and Romania—represents a material frontier with untapped resources, growing industrial potential, and proximity to Europe’s industrial heartlands. The region could influence the next decade of global materials geopolitics.
Untapped Resources: A Hidden Reservoir
The SEE region hosts significant deposits of copper, nickel, lithium, cobalt, tungsten, and natural graphite—all critical for electrification, battery production, and industrial metals supply chains.
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Serbia: Large copper-nickel deposits
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Bosnia & Herzegovina, Albania: Lithium and other strategic minerals
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Balkans: Early-stage graphite occurrences
Developing these resources responsibly, combined with midstream processing nearby, could shorten supply lines, diversify away from dominant hubs like China, and enhance European industrial resilience.
Europe’s Advantage: Proximity and Policy
Europe has a geographical edge in leveraging SEE resources. Reduced transport distances, faster delivery, and logistical efficiency make SEE-based industrial development cost-effective and time-efficient.
European frameworks, like the Critical Raw Materials Act, incentivize resource development near EU borders, offering co-financing, technical support, and industrial cooperation to SEE countries. EU-Western Balkans agreements further enable infrastructure development, investment facilitation, and regulatory harmonisation, potentially catalyzing European-controlled processing ecosystems.
Additionally, Europe’s ESG standards and strong regulatory oversight appeal to Western investors, enhancing strategic alignment with global sustainability expectations.
China brings capital, infrastructure, and industrial integration to SEE. Chinese state-owned and private enterprises have engaged in mining exploration, infrastructure projects, and industrial partnerships across the region.
China’s advantages include:
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Speedy capital deployment with long-term strategic horizons
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Integrated industrial partnerships, linking exploration with processing and downstream integration
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Control over supply chains, which could create European dependency on non-European-managed resources
If left unchecked, Chinese influence could embed SEE’s industrial ecosystems within China-centric supply chains, even though geographically close to Europe.
The United States and Other Global Actors
The U.S. views SEE through strategic and security lenses, focusing on supply chain diversification, allied partnerships, and industrial investment, but lacks Europe’s geographical imperative for rapid deployment.
Japan and South Korea aim to secure advanced materials and battery supply chains, participating through technical cooperation, offtake agreements, and joint ventures.
Gulf states, India, and Turkey are also increasingly active, driven by portfolio diversification, long-term returns, and regional industrial ambitions.
The Competitive Advantage
Europe’s advantage lies in geography, policy frameworks, and proximity to industrial consumers. SEE integration can:
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Expand Europe’s industrial ecosystem into midstream processing
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Reduce reliance on distant hubs
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Strengthen supply chain resilience and sovereignty
However, structural inertia—slow permitting, fragmented national interests, high energy costs, and regulatory complexity—threatens Europe’s first-mover position.
China’s edge is execution speed and capital depth, while the U.S., Japan, and South Korea offer technology and industrial expertise, but without Europe’s geographical advantage. Emerging players participate opportunistically but lack sufficient weight to dominate independently.
The Strategic Imperative
Southeast Europe represents a critical opportunity for Europe to expand its midstream and downstream industrial footprint. Success requires:
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Coordinated geopolitical-industrial planning
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Mobilisation of capital and public-private investment instruments
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Streamlined permitting frameworks and regulatory alignment
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Integration of sustainability standards and skills development
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Anchoring SEE processing capacity under European industrial oversight
Failure to act risks strategic encroachment by China and other competitors, creating dependency even in geographically proximate regions.
