Strategy and Sustainability Critical to Malaysia’s Rare Earth Ambitions
Photo: East Asia Forum
In an article by East Asia Forum, Siew Yean Tham asserts that in order to commercialize its rare earth minerals, Malaysia must balance competing interests from China, the United States, and other partners, while ensuring sustainability and regulatory compliance.
Rare earth elements are a group of 17 metallic elements that are crucial components in electronics, electric vehicles, renewable energy technologies and semiconductors. But resources are concentrated in a few countries such as China, Brazil, India, Australia and Russia. US President Donald Trump’s willingness to strike a deal with China to restore access of seven rare earth elements in July 2025 shows their importance for global supply chains.
Malaysia’s announcement of the discovery of rare earth elements resources, based on a 2024 Department of Mineral and Geoscience reconnaissance study, has been deemed a potential bonanza. The study estimated there to be 16.2 million tonnes available domestically, based on limited geological evidence and sampling. Malaysia’s New Industrial Master Plan 2030 valued rare earth elements resources at RM747.2 billion (US$175 billion), with a potential to attract RM100 billion (US$23 billion) worth of investments, which will create 4000 job opportunities.
Malaysia’s ‘National Mineral Industry Transformation Plan 2021-2030’ aims to develop the mineral industry sustainably and along the entire value chain as a new source of growth. This includes upstream mining, mid-stream processing and downstream rare earth elements usage to manufacture advanced materials such as super magnets and electric motors. Malaysia aspires to develop a ‘mine to magnet’ ecosystem, aiming for local participation to make up 20 per cent of mine production. Following Indonesia’s export bans on nickel since 2022, a moratorium on rare earth elements exports from Malaysia has been in place since December 2023 to facilitate domestic processing and manufacturing.
