President Donald Trump and Australian Prime Minister Anthony Albanese cemented a sweeping new phase in U.S.-Australia relations Monday, signing an $8.5 billion critical minerals agreement aimed at countering China's dominance in rare earth supply chains while reaffirming Washington's commitment to the AUKUS submarine pact.
At the White House meeting-Trump's first formal bilateral session with the Australian leader-the two signed a framework for joint investment in critical mineral extraction, processing, and supply between the United States and Australia. Each country will commit at least $1 billion over the next six months, according to a joint statement, in what Albanese called "a really significant day" to take the relationship "to the next level."
"This is $8.5bn pipeline that we have ready to go. We're just getting started," Albanese said at the signing ceremony. Trump added, "In about a year from now, we'll have so much critical mineral and rare earths that you won't know what to do with them."
The agreement comes amid intensifying U.S.-China trade tensions, with Beijing threatening to curb exports of rare earths essential for high-tech manufacturing. A White House release said the initiative would target mineral deposits worth $53 billion, including rare earths, lithium, and nickel-key inputs for electric vehicles, defense systems, and aerospace technology.
The U.S. Export-Import Bank followed the announcement with $2.2 billion in preliminary financing commitments for seven Australian projects, including Arafura Rare Earths, Northern Minerals, and Sunrise Energy Metals. EXIM said the investments will help "counter China's export dominance and ensure Western supply-chain resilience." The Pentagon also revealed plans to build a gallium refinery in Western Australia, after China blocked gallium exports to the United States last December.
Trump and Albanese also addressed the future of the AUKUS security pact, a $368 billion trilateral defense agreement under which Australia will acquire nuclear-powered submarines from the United States and the United Kingdom. Trump, who had ordered a review of the pact after taking office, said Monday that it would move forward "full steam ahead."
"We do actually have a lot of submarines. We have the best submarines in the world," Trump said. "We're starting that process right now. I think it's really moving along very rapidly, very well."
U.S. Navy Secretary John Phelan, who joined the meeting, said Washington was working with Canberra and London to refine the existing AUKUS framework. "I think what we're really trying to do take this framework and improve it for all three parties, clarify some of the ambiguity that was in the prior agreement," Phelan said. Trump later described those changes as "minor details."
The meeting-held nine months after Trump's inauguration-featured a mix of diplomacy and tension. At one point, Trump turned to Australia's ambassador to the U.S., Kevin Rudd, who as prime minister had once called him "the most destructive president in history." Spotting him across the table, Trump quipped, "I don't like you either, and I probably never will."
Despite the aside, the discussion was largely cordial. Trump praised Albanese as "a great leader," adding that "America has no better friend than Australia." Albanese invited Trump to attend the 2028 Presidents Cup golf tournament in Melbourne, and the two leaders held a working lunch following their cabinet room talks.
Albanese's office later confirmed that initial projects under the minerals deal would include the Alcoa-Sojitz gallium project in Western Australia, responsible for about 10% of global supply, and the Arafura Nolans rare earth project in the Northern Territory, which will receive $100 million in equity investment. Both projects will provide offtake rights to the United States and Australia.
