This report shows how Australia can work with its trade partners to jointly transition heavy industries (such as steel, chemicals, automobiles and ship building) into a net zero world. The report argues that while the Government has taken steps to support Australia’s future green industries such as green iron and hydrogen with the Future Made in Australia (FMA) policy suite, more certainty about the demand for these future green commodities is required to unlock domestic investment.

Key recommendations

1. Australia should proactively develop export markets for green commodities by aligning trade policy with the FMA vision, focusing diplomatic efforts on key partners such as China and Japan.
2. Governments and industry should work to harmonise standards for green commodities and finance, and adopt innovative demand side mechanisms.
3. Australia needs to invest more strategically in new demand centres for green commodities in Southeast Asia.
4. Australia’s international climate finance should be deployed to better support clean industrial development in emerging economies that could demand Australia’s green exports in future.
5. The Government should consider establishing a bilateral green bank to de-risk private capital finance and investment in key markets.