Australia Should Learn from Canada and Take a Truly Global Approach to Critical Minerals

These companies operate 2,861 projects around the world: 1,953 in Australia and 908 overseas. Of these projects, 444 involving 282 companies have critical minerals as their primary commodities, with 241 such projects based in Australia and 203 outside Australia.

The reserves of critical minerals identified by these operations so far are valued at $1.815 trillion, $949 billion of which is in Australia and $866 billion outside Australia.

To October 2023, capital expenditure in Australian-operated critical minerals projects totaled $32 billion in Australia and $45 billion in other countries.

With such a massive stake in critical minerals, Australia needs to diversify from its domestic focus and adopt a truly global supply-chain strategy for critical minerals. One of its strategy’s objectives is to ‘create diverse, resilient and sustainable supply chains through strong and secure international partnerships’ and Australia’s critical minerals investment data makes a compelling case for greater collaboration, including upstream in other mineral-producer nations.

Australia’s allies are being sold short by its inward focus. This could be a missed opportunity to leverage formidable Australian investment, expertise and technology globally.

Like Canada, Australia has a responsibility to help developing countries apply strong sustainability frameworks to their production of critical minerals. Australian industry is being let down by poor government recognition of, and support for, its truly global reach.

This narrow view is not a new phenomenon. It has persisted under successive Australian governments, which until recent years didn’t even have a detailed picture of Australia’s global investment profile across all sectors, including mining. With incomplete information, governments focused almost exclusively on inward investment.

The exception was a period during the Rudd and Gillard governments in the early 2010s, when Australia expanded its economic diplomacy in Africa, Latin America and Asia. It focused on minerals-related trade and investment and supporting sound governance in these regions.

In fact, Australia has long used its aid program to quietly support developing countries to build their capacity to attract minerals investment and responsibly govern exploration and development. Australia recently provided funding to ASEAN nations to review their minerals cooperation action plan, and the Australian high commission in Ghana convened a mine security conference in September to help mining operations in western Africa meet emerging threats. And Australia has committed to working with other supplier nations in regions like Africa under the US-led minerals security partnership, which it joined in 2022.

Building on work like this, Australia should take a global view of minerals investment. It can invest in supplying critical minerals to like-minded nations while still supporting the sustainable development of these minerals in emerging economies.

Despite Australia’s short-sightedness, there’s much to recommend in both the Australian and Canadian strategies. Both strategies:

·  emphasize the role each economy can play in creating more diverse and robust global supply chains

·  prioritize developing their northern regions, which host much of their critical minerals

·  recognize the need to build infrastructure that unlocks opportunities for minerals development, particularly in remote areas

·  acknowledge that the participation of land-connected Indigenous peoples is necessary

·  note that a larger and more diverse skilled workforce is needed to support growth

·  detail the strong environmental, social and governance frameworks required to develop critical minerals with minimal footprint.

To add to these strengths, Australia should support the discovery and development of critical minerals deposits by Australian companies wherever they operate. This will nurture global supply chains between supplier, intermediate and customer economies, and make a much greater contribution to the global energy transition and security than taking a narrow, Australia-only upstream approach.

Ian Satchwell is an adjunct professor at the Sustainable Minerals Institute at the University of Queensland. This article is published courtesy of the Australian Strategic Policy Institute (ASPI).