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GAO-24-107176 1 (2024-09-10)

handle is hein.gao/gaoqtf0001 and id is 1 raw text is: Why This Matters Key Takeaways The White House and the Department of Defense (DOD) have reported that rare earth elements and other critical materials, such as tantalum and tungsten, are essential to national security. Since 2018, DOD's defense industrial base assessments have found that rare earths and other critical materials are essential building blocks in many DOD weapon systems and enable unique, high-performance combat capabilities. However, DOD has also assessed that it faces significant risks in its supply chains for these materials and that there would be a high potential for harm to national security in the event of supply chain disruptions. Of particular concern, most of these materials are mined and processed in China, which makes DOD's weapon system programs vulnerable to supply chain disruptions by an adversary nation. The James M. Inhofe National Defense Authorization Act (NDAA) for Fiscal Year 2023 included requirements for us to assess DOD's efforts to implement three procurement requirements for rare earths and critical materials, and one requirement governing sales from the National Defense Stockpile to certain adversary nations (Section 857 of Public Law 117-263). This is the first in a series of assessments that Congress asked us to provide on DOD's ongoing efforts to implement these statutory requirements. This report describes DOD's efforts to implement the statutory procurement requirements in its defense acquisition regulations. It also includes an assessment of the steps DOD has taken to ensure that material from the National Defense Stockpile is not sold to certain adversary nations-China, Russia, North Korea, and Iran-or entities acting on their behalf if such sales are not in the interest of the United States. * Critical materials, such as rare earths, are materials needed to supply U.S. military, industry, and essential civilian needs during a national emergency and are not found or produced in sufficient quantities in the U.S. * Rare earths and certain other critical materials, such as tantalum and tungsten, are overwhelmingly mined and processed abroad, making the U.S. reliant on foreign suppliers-particularly China. Foreign dependence is especially challenging for DOD, which has limited ability to influence the supply chains since its purchases represent less than 0.1 percent of the global demand for these materials. * DOD is currently updating its acquisition regulations to implement new or revised statutory requirements for the procurement of rare earths and other critical materials. For example, based on a new statutory requirement, DOD will have to require that contractors disclose the source of certain rare earth permanent magnets used in DOD systems, among other things. These Page 1 GAO-24-107176 Critical Materials Page 1 GAO-24-107176 Critical Materials

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