President Donald Trump and Australian Prime Minister Anthony Albanese formalized a landmark critical minerals agreement Monday at the White House, marking a strategic effort to reduce Western dependence on China’s dominance in the rare earths market.
The comprehensive deal, negotiated over four to five months according to Trump, establishes an $8.5 billion pipeline designed to secure steady supplies of essential materials for defense and technology sectors. Both nations will commit over $3 billion toward critical mineral projects within the next six months.
Under the agreement’s framework, the Pentagon will finance a gallium refinery in Australia, while Canberra pledges to increase its total American investments to $1.44 trillion by 2035—representing nearly $1 trillion in new capital. This strategic partnership directly addresses growing concerns about Beijing’s tightening grip on global rare earth supplies.
The timing proves critical as China, which controls the world’s largest rare earth reserves, continues expanding export restrictions on these vital materials. Despite China’s dominant position, Australia possesses significant reserves and aims to establish itself as a reliable alternative supplier for Western allies.
Beyond minerals, the leaders addressed the $239 billion AUKUS defense pact, originally established in 2023 under President Biden. The arrangement involves Australia purchasing American nuclear-powered submarines by 2032, followed by jointly developing an advanced submarine class with Britain.
Navy Secretary John Phelan indicated both nations are refining the AUKUS framework to eliminate ambiguities, though Trump characterized these as “minor details,” emphasizing the program would proceed at full speed.
Australia has already demonstrated commitment by contributing $2 billion this year to expand American submarine production capacity and preparing to maintain Virginia-class submarines at its Indian Ocean naval base starting in 2027.
The summit, delayed ten months since Trump’s inauguration, underscores the deepening strategic alliance between Washington and Canberra amid intensifying geopolitical competition in the Indo-Pacific region.
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