“Why is Donald Trump talking about annexing Greenland? Well, they’ve got a supply of critical minerals. Why is he talking to [Ukrainian President Volodymyr] Zelensky about a critical mineral arrangement?
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“Australia is the lucky country. We have either the largest or the second-largest reserves of all the critical minerals in the world. [The US] would get guaranteed access to our critical minerals, and we say that should be of value to them.”
Farrell said that due to Greenland’s extreme climate and Ukraine’s war with Russia, Australia offered the US the simplest access to critical minerals: “Otherwise, where do they get it?”
The US is in talks to set up a $5 billion fund to invest in critical minerals, Bloomberg reported last week, and Albanese announced at the United Nations this week an Australian summit to help lure US capital to process critical minerals and fund green energy as it scrambles to meet its hard-to-achieve renewables targets.
Critical minerals is a catch-all term for the elements that are used to manufacture advanced technologies including mobile phones, computers, fibre optic cables, semiconductors, banknotes, medical equipment and weapons. Many are used in low-emission technologies such as electric vehicles and solar panels.
Hayley Channer, a director at the United States Studies Centre at the University of Sydney, said rare earths was arguably Australia’s best bargaining chip with the Trump administration as the US tried to avoid a shortage of minerals such as lithium, germanium, graphite and cobalt, if China withheld supply. China did so after Trump’s Liberation Day tariff announcements in April, forcing US manufacturers and defence firms to slow production.
“The bottom line is that no single government or group of countries can secure all the minerals needed for all their various uses – the best they can hope for is to secure a handful, perhaps five, that they can create an end-to-end supply chain ex-China,” Channer wrote in a note on September 9.
She said each of the Virginia-class nuclear submarines in the US fleet required more than four tonnes of critical minerals.
Trump demonstrated his disregard for allies on Friday morning when he used social media to announce 100 per cent tariffs on pharmaceuticals with no notice.
The tariffs will be imposed on branded or patented medical drugs from October unless a company was already building a manufacturing plant in the US.
CSL, Australia’s largest healthcare manufacturer, initially slumped about 4 per cent on the ASX but recovered to be down 1.5 per cent after it told shareholders it was confident it could avoid the tariffs, as 60 per cent of its workforce is in the US and it has committed to investing $2 billion in production there.
Farrell also urged calm, pointing to a briefing he had received weeks ago indicating CSL’s plasma products would not fall into the category of drugs subject to new tariffs.
Health Minister Mark Butler said the government was working out what impact the new tariffs would have on Australian industry.
“We’ve been aware of the administration’s intention to take action against pharmaceutical imports into America, and we’ve been engaging with them and making the case why we should continue with the tariff-free trade that has characterised US-Australian relations for more than 20 years,” Butler said on Friday at a press conference.
Opposition leader Sussan Ley described the announcement as “a shocking but unsurprising development”, pressing Albanese on his relationship with Trump.
“We remain unsure whether the government made any representations on behalf of Australia and our important pharmaceutical industry. This is yet another issue the prime minister must address in his meeting with the US president in October, but he should not wait until then,” she said in a statement.
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