Vietnam can count on approximately 22 million tons of rare earths. They represent almost 19% of the world’s known reserves and are second only to China’s.
Vietnam can count on the second largest reserves of rare earths (REE, Rare Earth Elements) in the world. According to estimates by the International Energy Agency, China represents 70% of those extracted on a planetary level, as well as 90% of the global capacity for their processing.
If Beijing has near-monopolistic control of critical minerals used in every contemporary context - from smartphones to electric vehicles not to mention military hardware - Hanoi can still boast of having a fair say. Credit goes to the country’s estimated 22 million tons of rare earths, which represent almost 19% of the world’s known reserves and are exceeded only by China’s 44 million tons.
Despite this enormous potential, the Vietnamese nation remains a tiny player in the sector, with just 600 tonnes produced in 2023, down around 50% from 2022 levels. The East-Asian giant, in comparison, churned out 240,000 tonnes of rare earth, while war-torn and highly underdeveloped Myanmar also reached 38,000 tonnes. What, then, is Vietnam missing to roar?
Vietnam’s untapped wealth
As Asia Times has highlighted, Vietnam’s industry faces high processing costs, environmental issues, as well as exposure from industry leaders for illegal mining and sales of minerals. Last October, for example, senior industry executives ended up in handcuffs on corruption charges, including the president of Vietnam Rare Earth JSC, a partner of Australian mining companies Blackstone Minerals and Australian Strategic Materials.
The arrests have blocked government plans to auction new rare earth mining concessions and curbed interest from foreign investors. Amid such a scenario, Hanoi intends to continue implementing its agenda which envisages the extraction and processing of 2 million tons of rare earths per year between now and 2030 and the production of 60,000 tons of oxides of rare earths per year starting from 2030.
The possible rise of Vietnam in such a strategic sphere would give the Asian country a significant specific weight. Yes, because the United States still purchases approximately 74% of REE downstream products from China, its direct economic and geopolitical rival. Beijing’s monopoly is starting to be conceived by Washington as a double-edged sword, and therefore any other country capable of offering an alternative to the US could find itself facing a prairie.
The Vietnamese case is emblematic: rare earths are not as "rare" as one might think, given that deposits are everywhere. What is rare, if anything, is the technology needed to process and separate the minerals (almost every REE processing and separation plant is located in China).
What Hanoi can offer
Vietnam’s immense quantities of gallium , embedded in its estimated 5.4 billion tons of bauxite ore deposits (with higher concentration levels than Chinese reserves), could reduce the role of Beijing. The problem, as mentioned, is that most of the plants present in the Vietnamese country do not have adequate technologies for extraction and processing.
foreign investors can help Hanoi overcome sector bottlenecks, just as a significant boost can come from the United States. With the US, among other things, Vietnam signed a memorandum of understanding in 2023 to "strengthen technical cooperation to support Vietnam’s efforts to quantify its REE resources and economic potential" and " attract quality investments for the integrated REE sector development".
Currently, only eight American companies can make intermediate products by processing rare earths. This relative lack of capacity means that boosting Vietnam’s industry with US investment could take a long time.
Original article published on Money.it Italy 2024-06-13 06:39:00. Original title: La grande ricchezza non sfruttata del Vietnam: le sue immense riserve di terre rare
