BRUSSELS (Reuters) -The EU’s European Investment Bank and the Australian government said in a joint statement on Monday they would deepen cooperation on critical raw materials, as Western powers scramble to cut their reliance on China.
With the exception of Japan, Group of Seven countries and the EU are heavily or exclusively reliant on China for a range of materials from rare earth magnets to battery metals.
European officials and industry sources say financing remains a key hurdle in the bloc’s efforts to secure its supply chains of strategic minerals. Even the EU’s list of strategic projects receives no financial benefits.
The European Commission is due to present a wide-ranging economic security package on December 3.
“This declaration is the first step towards enabling the EIB to support the financing of critical minerals projects in Australia,” the statement said.
“(It) furthers existing collaboration between Australia and the EU across the critical raw materials value chain – from exploration and extraction to processing, recycling and innovation.”
The EIB set up a dedicated task force to support project development in critical materials early this year, with an aim to double the group’s financing.
The G7, led by Canada this year, formed a Critical Minerals Production Alliance with like-minded countries and agreed in October to mobilize public and private capital to fast-track graphite, rare earth elements, and scandium production.
Australia, which holds vast mineral reserves, offered to sell shares in its new strategic stockpile to G7 nations.
Last month, the U.S. and Australia committed $3 billion to mining and processing projects, and to a price floor for critical minerals, a step long sought by Western miners. The countries will also sign off on financing that includes offtake rights.
Similarly, Canada has signed an offtake agreement for scandium and graphite with Australian miner Rio Tinto, and Quebec-based Nouveau Monde Graphite.
(Reporting by Julia Payne in Brussels; Editing by Matthew Lewis)
