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Labor’s budget contains a $50 million commitment to accelerate Australia’s critical minerals sector. Prime Minister Anthony Albanese said the lion’s share — $30.5 million — was for a critical minerals research and development hub that would help government agencies support private industry. 

In 2013, Geoscience Australia conducted a study which found that Australia is rich in critical minerals that are essential for a high-tech world — for renewable energy transition, for batteries, smartphones, and the manufacturer of semiconductors.

It found that it is rich in antimony, beryllium, bismuth, chromium, cobalt, copper, graphite, helium, indium, lithium, manganese, molybdenum, nickel, niobium, platinum-group elements, rare-earth elements, tantalum, thorium, tin, titanium, tungsten and zirconium. Some of these commodities are considered most critical by the European Union, Japan, South Korea, the UK and the US. 

Australia could establish a nationally owned critical minerals company that exercised ownership and control of strategically important minerals. Why simply ship the minerals overseas to a global supply chain so it can manufacture electric cars and advanced products and then we pay to buy the finished products from abroad?

The national interest is better served by policies designed to promote technology transfer, local equity participation, and training. The real question is whether we would like to see an Australia that does more than simply act as a quarry for other people to make smart things.

Merely subsidising private investors — domestic or foreign — is weak tea. A national company would make it much easier for the government to develop Australia’s nascent battery production industry, which could be worth $7.4 billion annually and contribute more than 30,000 jobs by the end of the decade.

And it would make it easier to roll out the national battery strategy and the electric vehicle strategy. 

In Subimperial Power: Australia in the International Arena (Melbourne Uni Press, 2022), I describe how our critical minerals strategy is not concerned with nation-building or economic development but with creating a permissive environment for foreign investors to carve up Australia’s critical minerals. Its aim is to make Australia a better quarry.

The business press reports approvingly that “the Aussies come to Europe’s rare-earth rescue … When the EU goes looking for supplier countries for critical minerals to feed its manufacturing, several sets of ears around the world prick up at this, but few as eagerly as those in Canberra.”

You could say the same thing about Australia’s defence and foreign affairs officials, whose ears prick up just as easily — since their pursuit of relevance to the US is the external expression of this economic dependence.

Any funding that this budget hands out to private companies should be conditional on the Commonwealth getting equity in commercial spin-offs — at the start, when share prices were affordable. The government must also insist on income-contingent loans in the same way that Australian students are required to pay back their university fees once their incomes exceed some amount.

The government must insist on a golden share of any future property rights — including intellectual property — arising from immediate or spin-off investments.

Schemes such as these would reward private entrepreneurs while giving society a more equitable share of the profits.

This is a policy area that cries out for greater ambition and resolute economic nationalism. At a time of growing economic turbulence and fragile global supply chains, a sovereign capability in critical minerals is in Australia’s national interest.

Is it Australia’s turn to rake in the billions from our deposits? Let us know by writing to letters@crikey.com.au. Please include your full name to be considered for publication. We reserve the right to edit for length and clarity.