President Donald Trump and Australian Prime Minister Anthony Albanese signed a critical minerals agreement on Monday in Washington, marking a key step to secure supplies of rare earths and other vital materials.
The deal comes as China seeks to tighten its grip on the global market for these resources, which are essential for everything from electric vehicles to military equipment.
Negotiated over four or five months, the agreement establishes an $8.5 billion pipeline of ready-to-launch projects.
Both nations will contribute $1 billion each over the next six months to fund joint initiatives, including mineral processing facilities.
Albanese described the pact as a pathway to immediate action, emphasizing collaborative efforts with companies like Alcoa and a trilateral project involving Japan.
The U.S. Geological Survey notes that China holds the world's largest rare earth reserves, but Australia possesses significant deposits and processing capabilities, positioning it as a vital partner.
This accord aligns with broader Western strategies to reduce dependence on Beijing, especially after China's recent expansion of export controls on rare earths.
Top U.S. officials have decried these moves as threats to global supply chains.
The leaders also addressed the AUKUS security pact, a $239.46 billion deal from 2023 under which Australia will acquire U.S. nuclear-powered submarines starting in 2032, with joint development alongside Britain.
Navy Secretary John Phelan highlighted ongoing work to refine the framework and resolve ambiguities in the original agreement.
Trump dismissed concerns as "just minor details," insisting the partnership is proceeding "full steam ahead."
Australian officials reaffirmed their commitment, noting a $2 billion contribution this year to U.S. submarine production and plans to maintain Virginia-class vessels from 2027.
Despite a 10-month delay in formal talks since Trump's inauguration, which sparked some unease in Canberra amid Pentagon calls for higher defense spending, the summit signals renewed momentum.
Australia, meanwhile, maintains robust economic links with China, its top trade partner, exporting iron ore and coal despite past tensions including a $20 billion boycott from 2020 to 2023.
Albanese's government has pursued diversification, offering allies like Britain shares in Australia's planned strategic mineral reserve.
Trump plans to meet Chinese President Xi Jinping in South Korea later this month and visit China early next year, underscoring efforts to navigate trade frictions while advancing fair deals.