UK companies that import critical minerals will receive increased financial support in Chancellor of the Exchequer Rachel Reeves’ upcoming budget, aimed at strengthening British industries and reducing reliance on China.
Importers of lithium, graphite and cobalt for UK manufacturing will gain access to UK Export Finance (UKEF), a government body that typically assists British exporters and their buyers with financing and insurance. Eligibility for this support will require long-term contracts with UK exporters, benefiting sectors such as defense, aerospace, electric vehicles and renewable energy.
This initiative is part of a broader effort by Western nations to secure critical mineral supplies essential for advanced manufacturing, a sector currently dominated by China. The budget, set for October 30, will also facilitate finance contracts for suppliers in Commonwealth countries with significant mineral deposits, like Australia. Prime Minister Keir Starmer is currently engaged in trade and economic growth discussions at the Commonwealth heads of government meeting in Samoa.
Reeves is preparing to unveil a budget that includes tax increases and additional borrowing, seeking to raise approximately £40 billion ($52 billion) to fund priorities like the National Health Service and address a fiscal gap attributed to previous Conservative governments. There are discussions about adjusting the measure of debt used to guide fiscal rules, potentially freeing up an additional £50 billion for infrastructure spending.
While specific companies benefiting from the export finance initiative have not been named, significant manufacturers such as Rolls Royce Holdings Plc, a major user of imported metals, and Tata Motors Ltd., which is constructing a battery plant in southwest England requiring lithium, are likely to be among the beneficiaries.
The Labour government is also focused on attracting private investment to stimulate economic growth and increase tax revenue. Earlier this month, the government announced £63 billion raised at its international investment summit, although much of that had already been committed.
In Samoa, Starmer announced a £1 billion investment in the UK property market from Aware Super, an Australian fund, and Delancey Real Estate. AustralianSuper, Australia’s largest pension fund, is also expanding its international investment team in London, aiming to manage £250 billion from its London office by 2035.
Starmer held a business meeting with prominent figures, including AustralianSuper CEO Paul Schroder, Bank of America Chair Brian Moynihan, and Lloyd’s of London CEO John Neal, during his visit to Samoa.
