All opinions expressed in this article are solely the opinions of the contributors.
About 53 percent of raw lithium is mined in Australia, and almost all of that is sold to China, where it eventually becomes lithium-ore batteries used in our phones, computers and electric vehicles. But now, the U.S. has reached an agreement with Australia that will help build up a parallel supply chain, independent of China, for processing raw materials.
Straight Arrow News contributor Peter Zeihan takes a look at which U.S. allies will also benefit from this agreement.
Excerpted from Peter’s May 29 “Zeihan on Geopolitics” newsletter:
There’s one massive hole we’ll need to fill if the green movement will ever work in the US…mineral resources. Thankfully we just struck a deal with our Aussie allies, who happen to have many of the key minerals and resources we need.
This deal will enable the Australians to contribute mineral resources to the American greentech industry in a way that will allow them to benefit from the incentives and subsidies in the Inflation Reduction Act (IRA).
While Australia is a significant producer of many necessary Greentech resources, it’s not a one-stop shop for everything. They’re also great at producing the raw ore, but the value-add component isn’t their thing. Thanks to subsidies from the IRA, there will be an opportunity to bring value-add capabilities to the outback.
But what about all the other US allies? Will they be able to tap into this deal? We must remember that there is an inner circle and an outer circle of allies…for now, only the inner circle gets to play.
