US Ties to Israel Rattle Rare Earth Deal in Malaysia

The $96 million rare earth refinery project in Gebeng, Malaysia, has become embroiled in controversy over its ties to the Pentagon and Australia’s Lynas mining corporation. Activists are using the deal as a way to support Palestinians in Gaza, while also highlighting concerns about the use of rare earths in Israeli arms.

Malaysia’s government is under pressure from non-government groups and locals who want them to block or renegotiate the deal over fears that the rare earths processed in Gebeng could end up in weapons systems. The activists’ demands have a grain of truth, given the US’ reliance on Israeli arms suppliers and the role of rare earth elements in modern industrial production.

However, the connection between Malaysian rare earths and Israeli weapons is more nuanced than it seems. While the materials can be used to build fighter jets and missiles, they could also end up in washing machines or wind turbines. This nuance has been lost on some critics who view the deal as a straightforward case of “blood rare earths.”

The Lynas project is part of a larger puzzle of global geopolitics, with the US seeking to secure a supply of rare earth elements independent of China, which dominates the market. Washington’s Middle East policy has inadvertently triggered pushback on this deal, highlighting the interconnectedness of global affairs.

Malaysia’s government now finds itself caught between its commitment to Palestine and its strategic interests with the US. If it decides to block or frustrate the Lynas deal, it could raise concerns about license renewals for the Gebeng plant and potentially connect them to Malaysia’s obligations under international law.

The controversy surrounding the Lynas deal has shed light on the complexities of global supply chains and the challenges of ensuring responsible sourcing practices. As the world becomes increasingly reliant on rare earth elements, countries like Malaysia will play a crucial role in meeting this demand while balancing their own interests and values.

China dominates the rare earths market, accounting for over 90% of global production. However, its near-monopoly has raised concerns about supply chain security and potential export restrictions. The US government has been investing in several projects to reduce its reliance on Chinese rare earths, but these efforts have been hampered by long lead times required to bring new mines online.

The Lynas project is seen as a strategic opportunity for the US to break China’s near-monopoly, but it also raises questions about the ethics of sourcing rare earths. Malaysia’s government could potentially use its obligations under international law as a point of pressure to renegotiate the deal, requiring a delicate balancing act between its strategic interests with the US and its commitment to Palestine.

The outcome will have far-reaching implications for the global community, highlighting the need for responsible sourcing practices in the rare earths market. The controversy surrounding the Lynas deal is just one example of the complex web of interests that characterizes the global rare earths market, raising questions about geopolitics, morality, and international law.

As the world becomes increasingly reliant on rare earth elements, countries like Malaysia will play a crucial role in meeting this demand while balancing their own interests and values. The outcome of the Lynas deal will have far-reaching implications for the global community, underscoring the need for careful consideration of geopolitics, morality, and international law.