Australia and the European Union have signed a critical minerals trade agreement to try and deter China’s monopolisation of the critical minerals supply chain.
The agreement was signed today (28 May, 2024) with six months of “concrete action” promised by Australian and European politicians, including plans to make the mining of critical minerals more sustainable.
SIGNED 🇪🇺🤝🇦🇺! The EU and Australia have signed a new partnership in critical raw materials.
🌏This MoU is a leap forward in securing more sustainable critical raw materials for the 🇪🇺, while boosting investment in Australia.
More 👉 https://t.co/LjgV4R3St6 pic.twitter.com/jfqxTPbIAd
— Valdis Dombrovskis (@VDombrovskis) May 28, 2024
Thierry Breton, the EU Commissioner for Internal Market, stated that the agreement would consolidate the EU and Australia’s critical mineral market.
“[The agreement] will boost cooperation, investments, and businesses opportunities. We aim for more sustainable and responsible production and real industrial integration of value chains between the EU and Australia, supporting competitiveness,” he commented.
Looking ahead, Breton stated that the EU now needed to work with governments and the private sector to create investment opportunities.
In its 2024 thematic intelligence report on supply chain disruptions, research and analysis company GlobalData reported that global supply chain disruptions were becoming more frequent and severe.
Armed conflicts, such as the Russian invasion of Ukraine, and climate change had continually disrupted the supply of critical minerals in 2022 and beyond.
GlobalData noted that the supply chain disruption experienced since the 2020 Covid-19 Pandemic has been unprecedented.
As a global manufacturing hub, China has experienced rapid growth to its GDP for over 30 years and many critical minerals needed for green technology are mined by China.
China has heavily invested in critical mineral mines in countries like Australia to dominate the supply of green technologies like electric vehicle batteries.
Despite existing attempts from the US to decouple from China, GlobalData’s report concluded that it may be impossible for any country to completely decouple from China’s influence on critical minerals.
The Chinese government has already invested into a long-term plan for China to become self-sufficient and, despite a shrinking population, it continues to provide cheap, wide-scale labour.
GlobalData forecast that a cheap and fast green energy transition may require continued reliance upon China.
“In data: Australia and EU sign minerals trade agreement as supply chain disruption increases” was originally created and published by Verdict, a GlobalData owned brand.
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