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Australia Plans $360m Critical Minerals Funding to Offset China

Prime Minister Scott Morrison unveiled funding for a slew of projects in Western Australia, saying the big state would become a powerhouse for Australia’s allies

The planned laws are a response to an ACMA report that found four-fifths of Australian adults had experienced misinformation about Covid-19 and 76% thought online platforms should do more to cut the amount of false and misleading content shared online. Photo: Reuters


Australia announced almost A$500 million ($360 million) in funding to boost output of critical minerals, aiming to diversify supply for its allies and counter China’s dominance of the global market.

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 Australia’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.

A meeting of the Quad group leaders of Australia, the US, Japan and India agreed in Washington in September to improve supply chain security for rare earths.

“China currently dominates around 70 to 80% of global critical minerals production and continues to consolidate its hold over these supply chains. This initiative is designed to address that dominance,” Angus Taylor, the Minister for Industry, Energy and Emissions Reduction, said.

Diplomatic relations between Australia and China are strained, with Canberra describing trade sanctions imposed on Australian agriculture and coal by Beijing in response to political grievances as “economic coercion”.

Critical minerals are used in smartphones, computers, rechargeable batteries and electric cars as well as defence and space technology.


Rare Earth Plant

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 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.

The funding for critical minerals follows an announcement by Morrison on Tuesday that Australia will build a A$4.3 billion naval dry dock in Western Australia to maintain navy ships and nuclear submarines visiting Australia from allied nations, as well as those it will acquire under the AUKUS defence agreement with the United States and Britain.

China has criticised AUKUS and the Quad as Cold War constructs “targeting other countries”.


  • Reuters with additional editing by Jim Pollard





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Jim Pollard

Jim Pollard is an Australian journalist based in Thailand since 1999. He worked for News Ltd papers in Sydney, Perth, London and Melbourne before travelling through SE Asia in the late 90s. He was a senior editor at The Nation for 17+ years and has a family in Bangkok.


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