Washington, Oct 21 (AP) — On Monday, a significant bilateral agreement was signed at the White House by President Donald Trump and Australian Prime Minister Anthony Albanese, marking a crucial collaboration in the realm of critical minerals. As China intensifies its export restrictions on critical minerals, the United States is increasingly eyeing Australia's abundant rare-earth resources. The leaders heralded the USD 8.5 billion deal as a testament to the enduring partnership between the two nations.
President Trump, a Republican, expressed optimism about the agreement by predicting an imminent increase in the availability of critical minerals and rare earths, claiming their surplus might render them as inexpensive as USD 2 apiece. Prime Minister Albanese remarked that the deal escalates the US-Australia relationship “to the next level.”
The agreement arrives amid China's recent mandate requiring foreign firms to secure government approval before exporting rare-earth-based magnets produced or utilizing Chinese technology. The Trump administration warns that such measures afford China significant leverage over the global technology supply chain.
Kevin Hassett, the National Economic Council Director at the White House, highlighted Australia's pivotal role in this scenario. Praising Australia’s rich mining infrastructure, he stressed the nation’s capacity to aid in mitigating the global economy’s over-reliance on China for rare earths.
The accompanying Australian delegation included ministers responsible for resources, industry, and science, emphasizing the breadth of critical minerals mined in Australia that the US needs for various high-tech applications, from military equipment to consumer electronics.
The newly inked agreement may rapidly bolster US access to rare earth supplies, contingent upon American firms securing existing Australian output. However, experts caution it will take years, if not decades, to substantially diminish the global dominance China holds over this sector.
Pini Althaus, CEO of Cove Capital, underscored the importance of contractual measures like price floors to prevent China from undercutting global markets — a tactic historically wielded to quash international competition in critical minerals.
The deal exemplifies the US accreting partnerships to counter China's sway over rare earth resources. Treasury Secretary Scott Bessent previously articulated this strategy, citing the US and its allies' determination to resist China's centralized economic strategies.
Gracelin Baskaran from the Center for Strategic and International Studies noted the unprecedented speed and scale of the USD 3 billion investment pledged within six months towards joint critical mineral ventures between the US and Australia, reflecting the urgency of the initiative.
Though Althaus pointed out that Australia alone cannot fulfill all US needs, he advocated for continued investments in further mining projects globally, particularly in Central Asia, where legacy Soviet explorations might expedite development timelines.
Coinciding with Prime Minister Albanese's visit, President Trump is set to meet with Chinese President Xi Jinping later this month in South Korea.
In parallel, discussions also touched upon AUKUS, the security alliance among the US, Australia, and the UK established under President Biden's leadership. While describing its progress, Trump and Albanese reaffirmed its significance, with Navy Secretary John Phelan stressing the need for clarity and enhancement of the AUKUS framework.
Albanese, who was reelected in May, suggested his party's electoral gains were achieved by rejecting Trumpism, emphasizing Australia's commitment to addressing global challenges through mutual support and forward-thinking. (AP) GRS GRS
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