Kirsty Needham

SYDNEY (Reuters – Australia announces almost A$500m ($360 million), in financing to improve output of vital minerals. The funding is intended to diversify supplies for allies and to counter China’s global dominance.

Scott Morrison, Prime Minister, unveiled Wednesday’s funding plan for Western Australia projects. He also stated that Australia would be an economic powerhouse.

Recent events show that Australia is facing the most dangerous and difficult security environment in its history. He said that the events in Europe were a reminder about the relationship between national security, energy security, and economic security.

The leaders from the Quad groups of Australia Japan USA Japan India were able to meet in Washington, September in order to increase supply chain security of rare earths.

China currently controls 70-80 percent of the global critical mineral production, and is retaining its control over supply chains. This initiative is intended to reduce that dominance,” stated Angus Taylor (minister for industry and energy reduction).

Relations between Australia and China have been strained. Canberra described trade sanctions placed on Australian coal and agriculture by Beijing as “economic coercion” in response to political grievances.

Smartphones, electric cars, batteries, and rechargeable batteries all use critical minerals. This is in addition to defence and space technology.

The funding will go towards the construction of a second rare earth separation facility outside China as well as a battery material refinery, vanadium processing plants and a battery material refining plant. It will also help commercialise research done by the government and create new businesses.

This month’s budget will include A$200million for grants that help bring critical mineral projects to market. Australia has made A$2Billion of financing available to help build this sector.

Australia is home to half of the world’s lithium and the country is also the largest producer of cobalt. It is fourth in rare earths production.

Officials also stated that diversifying resource exports would strengthen Australia’s economy.

Australia exports energy and resources worth A$348.9 million. Iron ore from Western Australia is the country’s largest exporter.

Morrison announced Tuesday that Australia would build a A$4.3Bn naval dry dock in Western Australia. This will allow Australia to keep its navy ships, nuclear submarines and other vessels visiting Australia from allies. It will also acquire critical minerals under the AUKUS defense agreement with Britain and the United States.

China has criticized AUKUS/the Quad for being Cold War Cold War constructs that “target other countries”.

($1 = 1.3887 Australian dollars)