On October 20, Australia and the United States signed a multibillion-dollar deal to cooperate on rare-earth and critical minerals. Australian Prime Minister Anthony Albanese with U.S. President Joe Biden, signing the pact to counter China’s hegemony over strategic resources. This framework primarily aims at advancing the supply chain scorecard that was developed in response to the 2022 Defense Production Act.
This important agreement arrives at a time when both countries are looking to diversify their supply of critical minerals. Today, China is the world’s leading supplier of all of these important raw materials. Beyond powering technological advances, these materials are crucial to our national security. Australia and the U.S. are working closely to develop a more diverse and safer international supply chain. This partnership is a major achievement in that campaign.
Australian miners are jubilant about the new pact that has just been signed. They view it as an opportunity to bolster their own country’s leadership in the global minerals market. This agreement will underpin the success of mining projects at every Australian state and territory. It will draw more domestic investment, particularly in states rich with rare-earth elements.
Experts offer a word of caution, arguing that cutting back on China’s overwhelming dominance will take focused work over many years. The complications in creating new alternative supply chains and current infrastructure woes may make achieving these aspirational timelines difficult. To be clear, the pact is just a major step along the way. We’re only scratching the surface of our extensive journey toward improved distance from China’s mineral supply.
The trilateral agreement highlights a trend of increasing awareness of allied nations regarding the need to secure critical minerals. Australia and the U.S. are independently working to harden their supply chain. Thus their aim is a more resilient economy that can thrive in the face of geopolitical weaponization.