As energy shocks and the clean energy transition, critical minerals dependency and supply chain vulnerabilities exert increasing pressure on the Australian and UK economies, a new report from the United States Studies Centre (USSC) at the University of Sydney highlights where the two allies can coordinate for mutual benefit.

While the Australian and UK economies are very different, the report outlines several areas where deeper cooperation is possible, including supporting free trade rules and norms; foreign investment screening; attracting trusted capital to technology; critical minerals supply chains; and clean energy manufacturing.

Across each of these sectors, Australia and the UK can deploy a two-pronged approach: institutionalising knowledge sharing while taking coordinated action. “Similar governance structures and domestic challenges create the perfect environment to share lessons learned and coordinate action in specific sectors”, USSC Director of Economic Security Hayley Channer noted. “We can build on the industrial base, tech and supply chain cooperation foundation established via AUKUS to expand our coordination into other areas for economic resilience.”

Recognising the increasing weaponisation of economic dependencies by China, Russia, Iran and others, and the “America First” economic policies of our mutual US ally, the USSC and Chatham House partnered to bring Australian and UK senior officials and private sector experts together to identify where bilateral economic security cooperation was most urgent and impactful.

An Australia-United Kingdom agenda for economic security by USSC Research Associate Sahara Hoff outlines the key findings from this project and offers recommendations to support the Australian and UK governments and private sectors navigate the increasingly turbulent economic environment.

With technology and geopolitics changing rapidly, one project participant warned that if the Australian and UK governments are too risk-averse they are “taking on risk by not taking risks." Another participant said that while Australia and the United Kingdom aim to be “influential middle powers with agency,” neither carries sufficient economic weight to shape the geoeconomic environment alone.

“In this rapidly changing and highly disrupted geopolitical climate, Australia and the UK are lucky to have built decades of trust and defence cooperation that now they can turn their attention to the new challenge – economic security coordination,” Ms Channer said. “Fortunately, we are well prepared to implement an economic security agenda as a natural flow-on from our existing alliance frameworks.”

Australia-United Kingdom agenda for economic security is now available to view or download.

Read or download the report now

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Key recommendations:

Participants in both roundtables identified recommendations across five key areas to guide cooperation between Australia and the United Kingdom. Recommendations include:

  • Critical technology | Coordinate existing public financing mechanisms, like the United Kingdom’s National Security Strategic Investment Fund and Australia’s Advanced Capabilities Investment.
  • Foreign investment | Establish more systematic Australia-UK information-sharing on foreign investment risks, including high-risk investors, to strengthen screening decisions.
  • Clean energy | Explore greater alignment between emissions and reduction policies, such as the United Kingdom’s Emissions Trading Scheme and Australia’s Safeguard Mechanism.
  • Critical minerals | Build demand-side signals for critical minerals from trusted sources through developing end-to-end supply chain initiatives to link supply and guaranteed offtake.
  • Internal coordination | Use existing structures — such as AUKUS, Five Eyes, the G7+ and the CPTPP — more effectively as platforms for economic security.