REE export curbs can help Malaysia move up value chain, say experts

Malaysia's experts argue that restrictions on raw REE exports could help the country develop its processing and downstream industries, provided domestic capabilities are simultaneously built up. Universiti Kebangsaan Malaysia's Idzat Idris believes the moratorium could encourage local processing and manufacturing, leading to greater value creation in industries such as electric vehicles, high-efficiency motors, and aerospace equipment.

However, without sufficient local technology and processing capacity, the restrictions could result in stockpiling, weakened prices for miners, illegal exports, or dependence on foreign technology providers or buyers. Environmental economist Norlida Hanim Salleh notes that the moratorium could prevent Malaysia from making the same mistakes seen in its tin industry, where value was mainly generated after the raw material left the country.

The Science, Technology and Innovation Ministry is working with researchers and industry to develop local REE technology and commercial applications, focusing on advanced separation processes, magnet recycling, and greener extraction methods. The Ministry has established facilities such as the Terra Mineral Lab and Malaco Mining's pilot plant to support this effort.

Foreign partnerships are seen as necessary, but should involve measurable technology transfer, local participation, and balanced Malaysian representation in administrative and technical roles. Effective enforcement of impact assessments, independent monitoring, and strict enforcement are crucial to ensuring sustainable REE mining and preventing potential environmental issues.