The United States agreed to boost cooperation with Japan on critical mineral supply chains and to expand access to tax breaks as U.S. President Joe Biden aims to counter China’s dominance of the electric vehicle battery sector.

Following the pact, EVs that use materials that have been collected or processed in Japan will be eligible for incentives under the U.S. Inflation Reduction Act, Japanese trade minister Yasutoshi Nishimura said Tuesday in Tokyo.

In a statement, U.S. Trade Representative Katherine Tai lauded Japan as "one of our most valued trading partners.”