Malaysia Eyes Growth in Rare Earths Sector
China has expressed readiness to support Malaysia in developing its rare earths industry. However, it has set a clear condition: any cooperation must involve only Malaysian state-linked companies.
Malaysia aims to build up its rare earths mining and processing capabilities. The country wants to take advantage of the growing global demand for critical minerals used in electric vehicles, semiconductor chips and military technologies.
In a written reply to Malaysia’s Parliament, Natural Resources and Environmental Sustainability Minister Johari Abdul Ghani confirmed that Chinese President Xi Jinping conveyed China’s offer during his visit to Kuala Lumpur in April.
China’s Role and Restrictions
China is the world’s largest producer and processor of rare earths. It plays a central role in the global supply chain. But Beijing has become more protective of its technology, introducing export controls on some processing methods.
Johari explained that China’s request to work only with government-linked firms stems from its desire to safeguard its technology. Discussions between the two countries are still at an early stage, and no formal agreement has been signed yet.
He also noted that China’s help is crucial, especially in the separation process of rare earth elements. China’s involvement would make Malaysia the only country to host both Chinese and non-Chinese rare earths technology. Malaysia is already home to a plant run by Australian miner Lynas in Pahang state.
Malaysia’s Policy on Rare Earths
Malaysia has banned the export of raw rare earths. Only processed materials are allowed to be shipped abroad. This policy aims to prevent exploitation and retain more value within the country.
According to a separate parliamentary reply, Malaysia holds an estimated 16.1 million metric tonnes of rare earth deposits, based on a 2019 study by the Minerals and Geosciences Department. However, Johari cautioned that further research is needed to determine how much of that can be mined. The government currently bans mining in protected forests, environmentally sensitive zones and nature reserves.
with inputs from Reuters
