EU, Australia Sign Critical Minerals Pact to Diversify Supply Chains
ca.finance.yahoo.com
Ben Westcott
Mon, May 27, 2024 at 11:30 p.m. PDT·2 min read
(Bloomberg) -- Australia and the European Union have struck an agreement to boost cooperation and investment in critical minerals, part of a drive by Western nations to loosen China’s grip on supply chains of materials essential to high-tech and green manufacturing.
Ministers in Canberra and Brussels signed a memorandum of understanding on Tuesday, which will be followed by the joint development of “concrete actions” over the next six months to improve collaboration on critical minerals projects.
Why the Fight for ‘Critical Minerals’ Is Heating Up: QuickTake
“Australia is a like-minded partner and a global leader when it comes to critical raw materials,” EU Commissioner for Trade Valdis Dombrovskis said in a statement. “This partnership marks a major step forward in our efforts to secure a more sustainable supply of critical raw materials for the EU, whilst fostering investment in Australia.”
The US and its allies have been working in recent years to establish alternative sources of critical minerals such as lithium, cobalt and nickel, which are used in the manufacturing of equipment including computer chips, solar panels and military hardware. China currently controls much of the supply, leaving the US potentially exposed to export restrictions given intensifying strategic competition between Washington and Beijing.
Access to critical materials has become a serious concern for the EU due to the potential for China to “weaponize” its dominance of the sector.
Australia has vast, largely untapped deposits of several critical minerals and has been attempting to build up its domestic industry through financing vehicles and tax incentives, including new measures announced in its May budget.
Under the MoU signed on Tuesday, Australia and the EU will look to boost investment in critical mineral projects, including joint ventures, as well as cooperating on research and innovation. |
