The military-led government is urging the United States to beef up re-engagement efforts and rapidly boost investment in the war-torn nation’s rare earths mines, a critical sector now dominated by China.
The US State Department outlined a plan to expand influence and potentially gain access to Myanmar’s rare-earth deposits in a strategy document released last week, after months of secretive talks with Myanmar officials.
“Ultimately, the United States should treat Myanmar as a critical minerals priority, not simply a diplomatic challenge,” Washington lobbying firm DCI Group said in a newsletter on Monday published on behalf of Myanmar’s information ministry.
“Minerals are the natural place for this deepening relationship to grow, since they connect Myanmar’s economic potential to US national security and supply-chain priorities.”
A US State Department spokesman said in response to a query that Washington was encouraging Myanmar to make progress on key priorities including “improving the domestic operating environment for US businesses, and building towards a genuine peace process that stabilizes the country.”
Myanmar, engulfed in civil war triggered by a military coup in 2021, is one of the world’s main sources of heavy rare earths, most exported to China to be turned into magnets used in electric vehicles, wind turbines and other high-tech items.
China, which turns out about 90% of the world’s rare earth magnets, partly relying on raw material shipped in from Myanmar, has recently tightened state control of the sector.
But Myanmar’s main rare earths production sites in the northern region of Kachin are controlled by the Kachin Independence Army, a long-standing rebel group fighting the Myanmar military that has the backing of Beijing.
Since the 2021 coup, Washington froze Myanmar’s assets at the Federal Reserve Bank of New York and imposed sanctions in a bid to isolate its generals, until it reversed course by holding direct talks in September.
Washington’s new strategy aims to secure “at least three major commercial or investment deals valued above US$5mil (RM20mil) each” for US companies. But Myanmar’s government is asking for more.
“That is modest, given Myanmar’s mineral resources and America’s stated ambition to compete with China,” DCI Group said in its newsletter, after Myanmar roped in the lobbying firm last year to help rebuild US ties.
“China has already spent years building its position in Myanmar’s resource sector, and its companies and intermediaries hold advantages that will not be easily displaced.”
The Chinese foreign ministry yesterday said in a reply to a request for comment that China and Myanmar are “friendly neighbours and important partners,” which share a special bond.
“China opposes the politicisation of economic and trade cooperation and stands ready to work with the international community to safeguard the stability of industrial and supply chain,” the Chinese foreign ministry said.
The Myanmar government did not immediately respond to requests for comment.
President Donald Trump has made rare earths a national security priority since returning to office, directing billions of dollars towards several companies to strengthen US domestic production and supply chain resilience. — Reuters
