The Australian Government has agreed to further invest A$2bn ($1.27bn) in critical minerals to support the transition towards net zero and boost the economy.

Critical minerals such as rare earths are now at the centre stage towards a clean energy future.

With the additional funding, the government’s investment in the Export Finance Australia-managed Critical Minerals Facility has now increased to A$6bn.

Through this commitment, the capacity of the Critical Minerals Facility can now double Australia’s capability to finance critical minerals mining and processing.

The Critical Minerals Facility is a funding support for mining projects that are aligned towards Australia’s Critical Minerals Strategy 2023-2030.

Australian Prime Minister Anthony Albanese and Resources Minister Madeleine King announced the additional investment after the inaugural meeting of the Australia-United States Taskforce on Critical Minerals.

This task force is expected to play an important part role in building an alliance between the US and Australia.

It will help in creating a sustainable supply chain for critical minerals, vital for the manufacturing sectors of both countries.

Australia is positioned for responsibly sourcing and processing critical minerals. By working with international partners, it aims to facilitate the decarbonisation of its economy.

This cooperation between the US and Australia on critical minerals is central to the Climate, Critical Minerals and Clean Energy Transformation Compact.

The Compact is a framework that intends to coordinate policies and investments to support the expansion of clean energy and critical minerals supply chains, expedite market developments and address the growing energy demands in the Indo-Pacific region.

Albanese said: “My government is committed to transforming Australia into a renewable energy superpower and harnessing the critical minerals we have at home is crucial to achieving this.

“Australians will benefit through this investment in critical minerals, through technology, skills, jobs and economic gains.”

Albanese added: “Australia is committed to building sustainable and secure critical minerals supply chains with the United States. This is central to building a clean energy future and delivering economic growth.

“The expansion of the Critical Minerals Facility will help to build supply chains with the United States and support our shared clean energy, manufacturing and defence ambitions.”