It’s December 2015 in Paris, and everyone at the United Nations Framework Convention on Climate Change conference is in a state of euphoria. For the first time in history, countries have agreed to an international treaty to cooperate on curbing climate change. At the heart of the agreement to drastically reduce C02 emissions is an understanding that the use of renewables in the energy mix will need to more than double to meet commitments.

The text contains a few contradictions to avoid scaring the horses. Fossil fuels are not explicitly banned. And, in a bid to satisfy economists and northern capitalists alike, climate action is presented as the next big growth opportunity, ignoring increasing evidence that unchecked growth is accelerating climate breakdown. The important thing is that the treaty has gotten over the line.

Nearly eight years later, the Global North seems to have woken up to the fact that some countries took the Paris agreement at face value. After signing the agreement, China seized on the idea of “green growth” and their investments in renewable energy jumped by 60 percent. This figure has continued to rise, with manufacturing far outstripping the domestic capacity for absorption. With its early investments in solar, wind, and batteries for electrification, China has dominated the world’s supply chains of the critical raw materials that underpin these technologies. The countries of the global north are scrambling to catch up.

This scramble can be seen most recently in the U.S. Inflation Reduction Act and the EU’s Critical Raw Materials Act. Much has been written about the similarity between the two acts, with their emphasis on strategic autonomy and new partnerships. The underlying messages, too, are similar, namely that our territory will be the one to secure access to new and emerging markets.

The truth is there is just not enough of these resources to go around—except if large swathes of ecosystems are reduced to lifeless open pits and the planetary boundaries to support life are radically exceeded.

In the context of limited future supply, the EU and United States have gone from viewing each other as competitors to starting to revive the old transatlantic relationship in a bid to form a “club” that will start to tip the balance of critical raw materials (CRM) access in their favor.

Last week, President of the European Commission Ursula Von de Leyen used her State of the Union speech to announce that a CRM “club” would hold its inaugural meeting before the end of the year. In the same week, the European Parliament passed a resolution to open negotiations with the United States to “strengthen international supply chains of critical minerals.”

The wording might have surprised the Chinese, for whom international supply chains of CRMs are already plenty strong. Through strategic investments and its Belt and Road Initiative, China now processes around 60 percent of all CRMs worldwide and has absolute control over the market of Rare Earth Elements with 98 percent of the EU’s supply and 60 percent of world supply coming from China.

The EU and U.S. attempt to band together to create a new bloc for trading with existing and emerging CRM-rich countries is based on a misguided reading of the geopolitical tea leaves. Both countries are relying on a warm welcome from South America and Central Africa, with whom the United States and EU have historic and cultural links. However, for the countries that suddenly find themselves in possession of the raw material du jour, most are not keen to revisit a recent past that strongly featured exploitation as well as economic and political coercion.

So, while the United States and EU offer partner countries a trip down colonial memory lane, China’s offer has been simple: no-nonsense investment in projects and infrastructure, with none of the hard Environmental, Social and Governance (ESG) clauses that the EU in particular is often keen to apply. And China is not the only player without the weight of the colonial past behind them. New investment is flowing from India, Japan, and South Korea among others.

Against this backdrop, the EU and United States are going to need to go back to the drawing board on their vision. The global north cannot become a green oasis of renewables while the rest of the world must be content with fossil fuel hand-me-downs.

To address this, increased recycling has featured high on the agenda of both the United States and EU. But they must go one step further to reduce overall material use and drive down the demand side.

Second, the global north will need to come up with an offer stronger than what China and other competitors are offering. The global north will have to be prepared to pay properly and invest in tandem. Unlike the Chinese, the United States and EU will have to offer more of the supply chain, particularly in processing, to bring jobs and economic opportunities to partner countries, especially if they want ESG clauses to be part of the story.

This approach needs to be coupled with a mature outlook on the nature of the global south countries where deposits are largely found. These countries have their own development aims, strategic autonomy goals, and need for renewables. For example, with over two-thirds of the world lithium reserves located in Bolivia, Argentina, and Chile, and the whole world turning toward battery-driven electrification, it’s clear who holds the upper hand in negotiations. The new club of the United States and EU ignores this new balance of power at its peril.

Emily Iona Stewart is the Climate Advocacy Specialist for the Open Society Foundations Just Transition pillar where she informs OSF strategy on European climate policy. She has a background in European labor law and first began working on environment and climate issues a decade ago as the chief policy advisor to the Vice Chair of the European Parliament’s Environment Committee.