On that day, Australia and the United States made a significant and historic commitment. It followed their signing of a separate multibillion-dollar agreement that focuses on rare-earth and critical minerals. Australian Prime Minister Anthony Albanese hailed the signing of the agreement as a means of diminishing China’s dominance over critical minerals. These are the minerals that are going into every advanced technology including defense hardware.
The landmark agreement, worth billions of dollars, is a significant political move by both countries. They are motivated by an interest in both diversifying their own supply chains and securing access to strategic, vital resources. Critical minerals, most notably rare-earth elements, are necessary for high-tech applications. Today, they are at the heart of smartphones, electric vehicles and military equipment.
China’s leading role over the vast majority of the global market for these critical minerals has raised alarm bells regarding the risks of over-reliance on a single source. The new Australia-US “AusMin” Agreement, made this month, directly addresses this blind spot. It ensures more independence and security from the growing critical minerals supply chain. The second notable collaboration points to a larger strategy, to not only strengthen economic resilience but improve national security through diversified sourcing.
Ominously, even as optimism surrounds the deal, experts are wary about what it actually entails. They caution that efforts to challenge China’s critical minerals market hegemony will be hard-pressed to succeed. The success of building a better alternative supply chain can’t be achieved overnight. Achieving this will require massive investment in infrastructure and technology.
The merger is meant to provide a vigorous defense against China’s growing market domination. Analysts are cautioning that global supply chain complexities mean no short-term fix is guaranteed. We know the road ahead to a stable, independent critical minerals supply will not be easy or quick.
Other big-name dignitaries were at the Capitol signing ceremony, which was lined with patriotic bunting and decorated with a big framed photo of former President Donald Trump. Yet, President Biden was not personally connected to the agreement. This element has sparked conversations about whether U.S. policy on critical minerals would continue regardless of changes between Democratic and Republican administrations.