The new limits of growth
In the final article of our series, we explore how businesses face hard planetary and geopolitical limits that make the “business as usual” growth model untenable as climate shocks, biodiversity loss, and...
Geopolitics and Circularity
The Wild West of tech sovereignty
The race for tech sovereignty is intensifying as AI’s growth drives fierce competition for the rare minerals, chips, energy, and talent that underpin advanced computing. Supply chain fragility, geopolitical tensions, and export restrictions are reshaping access to critical materials, making circularity a strategic imperative. By recovering and reusing rare earth elements, other critical metals, and components from end-of-life products, companies can reduce dependencies, build resilience, and gain a competitive edge.
Everyone wants a piece of the AI gold rush. From Silicon Valley to Shanghai, governments and business leaders are pouring billions into chips, data, and code to stake their claim in the technology that many believe will define the next era of power.
But something critical is getting lost in the hype: all the algorithms and machine-learning breakthroughs in the world amount to nothing if you can’t get your hands on the hardware to run them. The scramble isn’t just for talent or patents, it’s for the rare minerals, chips, and specialized components (let alone water and energy) that make AI even possible.
In our earlier articles for this series, we explored how geopolitical rifts and resource nationalism are redrawing the global economic map. Nowhere is this more visible than in technology. Microelectronics and the semiconductor sector form the material backbone of modern computing, driving the demand for rare earth elements. Several critical metals are indispensable for this technological transition. Data center energy consumption is expected to more than double by 2030, according to the International Energy Agency, pushing nations and companies into competition not only for hardware but for stable energy to power it.
AI is everywhere in the news, but there’s a deeper story beneath the hype – one that’s being written in the boardrooms of semiconductor giants, the halls of national security, the production sites of energy providers, and the scrapyards (or better yet, the ‘urban mines’) of yesterday’s technologies.
This is not just a problem for governments. If you’re building or running a business that relies on advanced technology – whether that’s electric vehicles, cloud infrastructure, or consumer electronics – supply chain fragility is also your problem. Nations are stockpiling essential goods and materials, trade restrictions change overnight, and the new ‘tech sovereignty’ is as much about material flows as information flows and intellectual property.
“The chip shortages of recent years ground entire industries to a halt not for lack of ideas, but because a handful of minerals and fabrication plants were suddenly out of reach.”
We’ve already seen the warning signs. The chip shortages of recent years ground entire industries to a halt not for lack of ideas, but because a handful of minerals and fabrication plants were suddenly out of reach. As we’ve seen in our previous articles, geopolitics is reshaping trade in ways that make this fragility the new normal. Export controls from the United States have cut off China’s access to advanced chips, and China has responded with restrictions on exports of gallium and germanium, metals used in computer chips and other products. Taiwan, home to the world’s most advanced semiconductor manufacturer, TSMC, sits at the center of a geopolitical fault line, a critical chokepoint today that’s as important for the global economy as the Persian Gulf and the Strait of Hormuz were in the 1970s and 1980s. For companies whose products or services depend on advanced computing, these are not abstract risks; they are existential dependencies.
Tech sovereignty is now about much more than data privacy or software leadership. It is about securing:
- Materials sovereignty: Rare earths, lithium, cobalt, and high-purity silicon.
- Manufacturing sovereignty: Domestic or allied chip fabs to avoid single-point failures.
- Energy sovereignty: The renewable, reliable power to run AI infrastructure at scale.
- Workforce sovereignty: Skilled engineers and technicians to build, maintain, and recover high-value tech.
Here’s where circularity enters as a key lever of strategic power. Imagine a world where you don’t just passively rely on a future recycling system but instead take an active role by embracing circular strategies. You put the tech to the most productive use over its lifetime (for instance, giving batteries from electric vehicles a second life as industrial energy storage). You explore business models where you stay in control, for example offering access to products over ownership. You explore trade-in and resale strategies. Or you form partnerships and build ecosystems that help you actively recover and build a supply of secondary raw materials, reducing volatilities in your value chain.
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Learn moreYou can see this in practice by visiting an advanced electronics recycling facility.
Tomorrow’s devices can be built by strategically recovering rare earth elements, critical metals, and chips from yesterday’s devices. Intelligence about end-of-life locations of products and access to ‘urban mines’ can become strategic information. Take Apple’s Daisy robot, which recovers gold, cobalt, and rare earths from discarded iPhones, turning e-waste into a strategic resource and insulating the company from raw material shocks. Meanwhile, Europe’s new Right to Repair regulations are forcing tech manufacturers to think about recovery and reuse from day one, not as an afterthought.
You can see this in practice by visiting an advanced electronics recycling facility. There you’ll witness high-speed, high-value disassembly lines where yesterday’s waste becomes tomorrow’s supply of critical inputs. These are the emerging nodes of digital sovereignty.
But let’s also be realistic: we need to break systemic barriers and accelerate the scale of material recovery systems. Nobody really knows, for example, where half of the electronic devices placed on the market in Germany end up. Hoarding at home and untransparent export flows make it hard to recover secondary material cost-efficiently at scale. Most product design choices make recycling difficult, if not impossible. The problem is worsening: batteries embedded in more products are causing more and more fires at recycling and waste sortation plants and adding to an already complex material mix.
AI is also supporting material discovery and innovation processes.
This is where governments and innovation ecosystems need to work in tandem. Policy is advancing – from the EU’s Critical Raw Materials Act to national chip strategies – but technological innovation, especially AI-powered sorting, recovery, and material discovery, will be critical. In plastics and packaging, for example, new AI-driven waste collection and sorting solutions improve the quality and cost efficiency of material recovery. Companies like Greyparrot or EverestLabs are leading innovators in this field of waste intelligence. AI is also supporting material discovery and innovation processes. The start-up One Five, for example, is helping through analytics-based packaging optimization to balance a multitude of complex factors that influence design decisions.
In today’s tech landscape, control is everything. Leaders who can close the loop on materials, manufacturing, and innovation will be the ones shaping the next era of digital power. In this new context, the wait-and-see approach may be riskier than taking a proactive role to develop a competitive advantage. In the age of fractured geopolitics we’ve traced through this series, the line between national advantage and corporate survival has never been thinner.
In our next and final article of our five-part series, we’ll zoom out to the bigger picture: how climate resilience, resource scarcity, and the planet’s natural boundaries are redrawing the map for economic growth, and what it will take for business leaders to stay ahead in this changing landscape.
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