Australia Poised to Prosper as Global Demand for Critical Minerals Soars

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According to official forecasts unveiled on Wednesday, Australia’s economy is on the brink of a lucrative boom as global demand for critical minerals is projected to surge by 350% by 2040.

With the world’s focus shifting towards achieving net-zero emissions by 2050, Australia’s abundance of resources such as lithium, nickel, zinc, and bauxite places it in a prime position to meet the growing demand for clean energy technology.

Treasurer Jim Chalmers expressed optimism, hailing critical minerals as Australia’s “big chance and big opportunity” to diversify its industrial base. 

“We have just what the world needs, just when it needs it,” Chalmers said.

Australia supplies nearly half of the world’s lithium and holds extensive reserves crucial for electric vehicles and batteries. Moreover, around 80% of the country’s land remains unexplored, harbouring potential for valuable mineral discoveries.

The much-awaited Intergenerational Report 2023 from the Australian government foresees a substantial and prolonged surge in global lithium demand until 2063. This projection is poised to notably grow Australia’s export opportunities, including a projected doubling of spodumene concentrate exports within the next five years, commencing in 2022.

However, BHP raised concerns about Australia’s critical minerals industry, noting that unlike the accessible iron ore and coal deposits that have historically driven the nation’s wealth, minerals like copper, lithium, nickel, and rare earth are in smaller, deeper reserves, demanding costlier processing methods.

BHP CEO Mike Henry called for a focus on Australia’s competitiveness in fiscal terms and productivity when it comes to investments in critical minerals. 

“For investments in critical minerals, Australia has to focus on its competitiveness relative to other jurisdictions, both on fiscal terms and productivity,” Henry said.

As the world races to transition to cleaner energy sources and reduce greenhouse gas emissions, Australia’s wealth of critical minerals positions it as a vital contributor to global efforts. 

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