Malaysia Enters the Rare Earth Export Market

China is the leading exporter of rare earth minerals to nations such as Japan and the United States.  These materials are key inputs in making “green products” such as hybrid vehicles.   The pursuit of rare earth minerals causes serious environmental problems for the exporting nation.  The pursuit of the “green economy” in an age of globalized trade will create new pollution havens.   Berkeley is unlikely to choose to enter this growing field.   Today, we learn that Malaysia  is eager to be a rare earth’s exporter.  This competition will challenge China and encourage it to play nice.

“All of this helps explain why a giant Australian mining company, Lynas, is hurrying to finish a $230 million rare earth refinery here, on the northern outskirts of Malaysia’s industrial port of Kuantan. The plant, with the first phase scheduled for completion late this year, will refine slightly radioactive ore shipped from a mine deep in the Australian desert, 2,500 miles away.” Now, that’s value added.  I hope that there isn’t a residential community living downwind from the plant?

Author: Matthew E. Kahn

Professor of Economics at UCLA.

5 thoughts on “Malaysia Enters the Rare Earth Export Market”

  1. I hope that there isn’t a residential community living downwind from the plant?

    And who cares if there is?
    Not my governors…

  2. It is much easier to foul our nest for our grandchildren than it is to change our lifestyles.

  3. One has to wonder how Malaysia’s jumping into the rare-earths business will affect domestic plans to re-open the Mountain Pass Mine in California: closed due to pollution issues a decade ago, kept closed by cheap Chinese competition til recently, re-opening planned (supposedly, this time, with adequate protections) due to the Chinese playing games with the market. One assumes that Malaysia would have an advantage in costs and (lack of) pollution controls; but I’m guessing the US will want to keep a home-mined supply of this stuff available, regardless.

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