Amcham Study Highlights Economic Potential of Critical Minerals in Brazil

A study by the American Chamber of Commerce for Brazil (Amcham) indicates that increasing the domestic processing of critical minerals could significantly boost Brazil's GDP and job market by 2050. The report focuses on materials such as copper, graphite, lithium, nickel, and rare earths, which are essential for batteries, electric vehicles, electronics, and military systems. Brazil holds the world's largest reserve of niobium, the second largest of graphite and rare earths, and the third largest of nickel, yet it processes a small fraction of what it extracts. In 2023, only 5 percent of extracted lithium and less than 40 percent of nickel were processed internally.

The Amcham study compares two economic scenarios. The first scenario, funded by domestic capital and focused on exports, predicts a cumulative GDP impact of 1.1 percent, or 128.7 billion reais, creating 304,000 jobs. The second scenario, which combines deeper integration into Brazilian industrial chains with an increase in foreign capital from 4 percent to 15 percent, predicts a GDP impact of 1.64 percent, or 192.1 billion reais, and 750,000 jobs. This second path represents a potential gain of 63.4 billion reais and 446,000 additional jobs.

These findings emerge amid strained relations between Brazil and the United States. The Trump administration has treated critical minerals as a matter of national and economic security, restricting defense industry acquisitions to the U.S. and its allies. Current tensions include tariffs, diplomatic disagreements, and the revocation of the Brazilian ambassador's visa in Washington. Analysts note that while the study suggests growth through foreign investment, Brazil must weigh this against national autonomy and the potential environmental and social impacts on indigenous and quilombola populations.