Kuala Lumpur: Malaysia will continue to enforce its ban on the export of raw rare earths to safeguard domestic resources, even after signing a new critical minerals cooperation deal with the United States, Trade Minister Tengku Zafrul Aziz announced.
Speaking in parliament, Tengku Zafrul dismissed claims that Malaysia intended to permit the export of critical minerals and rare earths to the US for short-term economic or strategic benefits. Tengku Zafrul stated that, “We no longer want to be a country that only digs and ships out cheap raw materials like in the past.”
Tengku Zafrul emphasised that the government aims to promote foreign investment and technology partnerships in local mining and processing industries. The minister clarified that Malaysia’s stance is not a permanent trade restriction but a strategic move to ensure domestic value addition. Tengku Zafrul added that, “Our policy is to prevent the export of cheap unprocessed raw materials so that value is added to Malaysia.”
Government data estimates Malaysia’s rare earth reserves at around 16.1 million metric tonnes. However, the country still lacks advanced mining and processing capabilities for these resources, which are vital for sectors such as electric vehicles, semiconductors, and defence technologies.
Earlier this month, the media reported that Malaysia was in talks with China to collaborate on rare earth processing, with sovereign wealth fund Khazanah Nasional expected to partner with a Chinese company to develop a refinery locally.
During US President Donald Trump’s visit to Kuala Lumpur, Washington signed separate critical minerals cooperation agreements with Malaysia and Thailand, seeking to strengthen supply chains and reduce dependence on China.
A joint US-Malaysia statement noted that Malaysia had agreed to avoid implementing export bans or quotas on critical minerals and rare earth elements to the United States, though Tengku Zafrul reaffirmed that unprocessed raw exports remain prohibited.
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