ReGen Strategic
Australia is undertaking a series of set pieces that capitalise on its role as an economically-advanced middle power, while aiming to continue record levels of exports to China and maintain a healthy strategic relationship with the USA.
Alongside AUKUS, the focussed progression of a renewable hydrogen sector and the advocacy for free and fair trade, Australia is seeking to open its shopfront to the USA for critical minerals and rare earths.
For Western Australia, this represents the chance to cement our role not only as the nation’s resources powerhouse but as an indispensable link in the global clean-energy value chain.
The USA-Australia critical minerals deal has been sequenced to counter the escalation of export controls by China, for minerals that are critical for technological advancement, renewable energy and defence applications.
An irony that should not escape anyone’s attention is that this deal is being sold to the American public as a way to buttress security in the Indo-Pacific , ostensibly from an emboldened China.
Australia will need to continue to tread a careful path between the two superpowers – despite Trump taking the view that “we'll be just fine with China”.
In the very short-term, the long-awaited meeting between US President Donald Trump and Australian Prime Minister Anthony Albanese has been a boon for critical minerals producers in Australia.
WA, well-endowed with the lion’s share of critical minerals and rare earths deposits, would appear to be extremely well positioned to support the implementation of this deal.
Given the recent capital flight towards gold and conservative assets, stock prices for a host of critical minerals and rare earths proponents soared on the news that projects would be underwritten by government funding from both nations and related regulatory processes would be accelerated.
Mr Trump indicated the deal would fast-track access to refined product, however the reality is that even the more prospective resources will require many years of development and sustained investment.
As ReGen Strategic has highlighted over the past 12 months, the operating environment for almost every commercial enterprise is facing a period of unprecedented volatility.
However, this volatility can bring as much opportunity as it can risk.
In an Australian context, the policy settings of a third-term Cook Labor Government and a two-term Albanese Labor Government are well known and less likely to change going forward.
As Minister for Resources and Northern Australia, Madeleine King says repeatedly, the “energy transition runs through WA”. The same could be said for the efforts to secure long-term access to critical minerals and rare earths that Australia and our major trading partners need.
If leveraged effectively, this moment could define the next phase of WA’s economic identity. If not, we risk remaining the shopfront while better prepared jurisdictions capture the downstream value.
The lesson from the recent critical minerals deal is for proponents to remain flexible enough to respond to changing circumstances and seize upon the windows of opportunity that stimulate investment interest, capital flows and progress with strategic stakeholders.