Australia’s rare earths projects get US$360 million funding boost to counter China dominance
- Projects to be funded include a rare earth separation plant and a battery material refinery in Western Australia
- China produces around 70 to 80 per cent of global critical minerals that are used in smartphones, electric cars, defence and space technology
Prime Minister Scott Morrison unveiled the funding for a slew of projects in Western Australia on Wednesday and said the state would become a powerhouse for Canberra’s allies.
“Recent events have underlined that Australia faces its most difficult and dangerous security environment that we have seen in 80 years. The events unfolding in Europe are a reminder of the close relationship between energy security, economic security and national security,” he told reporters.
Is China a key motivation behind Australia’s A$804m Antarctica funding boost?
“China currently dominates around 70 to 80 per cent of global critical minerals production and continues to consolidate its hold over these supply chains. This initiative is designed to address that dominance,” said Angus Taylor, minister for industry, energy and emissions reduction.
Critical minerals are used in smartphones, computers, rechargeable batteries and electric cars as well as defence and space technology.
Projects to be funded include the second rare earth separation plant to be built outside China, a battery material refinery and a vanadium processing plant. Funding will also be provided to commercialise government research and bring new companies to market.
Some A$200 million will also be included in this month’s budget for grants to bring more critical minerals projects to market. Australia has already made A$2 billion in financing available to build the industry.
Australia produces half the world’s lithium, is the second-largest producer of cobalt, and is the fourth-largest producer of rare earths.
Diversifying resources exports will strengthen the Australian economy, officials also said.
Australia’s vaccine diplomacy in Pacific islands eased tensions with China
Australia’s resources and energy exports are worth A$348.9 billion, with iron ore shipped from Western Australia to China the nation’s biggest export earner.
China has criticised Aukus and the Quad as Cold War constructs “targeting other countries”.