KUALA LUMPUR: Malaysia is open to foreign companies establishing joint ventures with local firms to develop rare earth minerals in Malaysia.
Investment, Trade and Industry Minister Tengku Datuk Seri Zafrul Abdul Aziz said Malaysia has a competitive advantage through its estimated rare earth element (REE) deposits of 1.6 million tonnes.
"We want to invite companies to come and invest here, and we want to get more Malaysians involved, not just in terms of the supply chain but also in terms of economic interests, meaning having some equity and shareholding as well in this venture," he said during a pool interview themed "How Asean's Economic Prosperity Supports Regional Political Stability" here on Wednesday (Oct 22).
Tengku Zafrul said that while the Investment, Trade and Industry Ministry (Miti) has yet to receive any proposal to set up a new REE processing facility in the country, Malaysia aims to be involved in midstream processing activities rather than merely exporting raw materials, which are of very low complexity in terms of economic value.
Malaysia had previously enforced a nationwide moratorium on the export of unprocessed (raw) rare earth materials, effective Jan 1, 2024. The move was intended to encourage companies to establish domestic processing and downstream industries to capture higher value, create jobs and ensure technology transfer.
"By banning raw REE exports, they are effectively compelled to come here regardless of which country they are from. For the government, especially Miti, which oversees downstream activities, we have no restrictions on which country comes in to develop their industries here," he said.
He added that by inviting foreign companies to set up REE processing plants, Malaysia hopes to create quality jobs, expand opportunities across the supply chain, and increase government revenue through taxes.
Tengku Zafrul noted that Khazanah Nasional Bhd was engaging with Chinese companies to explore opportunities in downstream REE activities.
"For Lynas, they are already here and are a fully private company. We will not stop them from exporting to markets of their choice. In their case, they have been exporting to South Korea, Japan, and the United States. We welcome all because, at the end of the day, Malaysia continues to remain neutral," he said.
Asked about Asean's fragmented policies on REE and collective regional strategies, Tengku Zafrul said the principle within Asean had always been that negotiations on issues of national and economic security are conducted bilaterally.
"I think most of us have similar policies, and we protect our national interests. We also want to ensure our neighbours share their challenges with us. That's what we do, particularly for the Priority Economic Deliverables (PEDs) under the Economic Pillar.
"We share technology, if there is any, as well as trading and supply chain ideas when we talk about supply chain security," he added. – Bernama
