Myanmar Urges U.S. to Invest in Rare Earths to Break Chinese Dominance

Myanmar’s military-led government is pressing the United States to invest in its rare earth mines, seeking a bigger U.S. role in a sector that feeds China’s dominant magnet industry.

The appeal follows the release of a U.S. State Department strategy last week that lays out how Washington could expand its influence in Myanmar and potentially gain access to its rare earth deposits.

The document followed months of private talks with Myanmar officials, according to Reuters.

The strategy calls for securing “at least three major commercial or investment deals valued above $5 million each” for U.S. companies.

DCI Group, a Washington lobbying firm that Myanmar hired last year to help rebuild ties with the U.S., called that target modest in a newsletter published Monday on behalf of Myanmar’s information ministry.

The firm argued that Myanmar should be a priority for Washington’s critical minerals policy and said China had spent years building its position in Myanmar’s resource sector, giving its companies and intermediaries advantages that would be difficult to overcome.

A State Department spokesperson told Reuters that Washington was urging Myanmar to improve conditions for U.S. businesses and make progress toward a peace process that would stabilize the country.

Rebel Forces Control Key Mines

Myanmar is one of the world’s main sources of heavy rare earths.

Most of its output goes to China, where the materials are used to make magnets for electric vehicles, wind turbines and other high-tech products.

China produces about 90% of the world’s rare earth magnets and has recently tightened state control of the sector.

Myanmar’s main production sites lie in the northern region of Kachin, where they are controlled by the Kachin Independence Army.

The group has Beijing’s backing and is fighting Myanmar’s military in the civil war that followed the 2021 coup.

Washington froze Myanmar’s assets at the Federal Reserve Bank of New York and imposed sanctions after the coup to isolate the generals.

It resumed direct talks in September. Since returning to office, President Donald Trump has made rare earths a national security priority, putting billions of dollars into companies in an effort to reduce China’s grip on the sector.

China’s foreign ministry and Myanmar’s military-led government did not immediately respond to Reuters’ requests for comment.