Prime Minister Anthony Albanese has announced major funding to "transform Australia into a renewable energy powerhouse" – a move that will see the country reduce its dependence on China.
Mr Albanese confirmed an extra $2 billion boost in government credit for projects to mine and process critical minerals - including key components used in electric car batteries while on a visit to the United States, one of Australia's key allies in an ongoing power struggle in the Indo-Pacific.
Australian businesses that invest in critical minerals projects may be eligible to receive financing or loans from thethe government's Export Finance Australia (EFA) agency
Mr Albanese said the move would allow to "build supply chains with the United States and support our shared clean energy, manufacturing and defence ambitions".
US Commerce Secretary Gina Raimondo said the US and Australia were acting after finding themselves in a "vulnerable" position, the Herald Sun reported.
"[Australia and the US have become] overly dependent on one or two countries around the world," she said.
“China has a head start, and that means we have to work a little bit harder and a little bit faster."
She noted Beijing has shown it is not afraid to slap tariffs on exports when desired, meaning if Australia and the US didn't act now, it could face "a great deal of pain very quickly" at the hands of China.
Funding to 'de-risk investment'
Critical minerals include so-called "rare-earth elements" - used in products like wind turbines and satellites - as well as cobalt and lithium common in batteries that are in electric vehicles and gallium, used in the production of smart phones.
According to US statistics, about 63 per cent of the world's rare earth production occurs in China while Australia is the leading global producer and exporter of lithium.
Resources Minister Madeleine King, also on the trip, said co-operation with US industry and scientific agencies was important.
"The road to net zero runs through Australia's resources sector," she said.
"The Australian government is providing significant support to de-risk investment in Australia's critical minerals sector... the Critical Minerals Facility is a cornerstone of that support.
"Coupled with our support for processing, we are well positioned to be a world leading provider of critical minerals, including rare earths elements, and to support global efforts on clean energy transformation."
The prime minister said investment in critical minerals would benefit Australians "through technology, skills, jobs and economic gains".
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