Myanmar's Rare Earths Boom: A Dirty Secret Fueling Green Tech

Myanmar has rapidly become a critical source of rare earth elements, essential components in everything from smartphones and electric vehicles to wind turbines and advanced military technologies. This boom, however, is built on a foundation of environmental destruction, human rights abuses, and escalating conflict, primarily in the northern Kachin State. The rush to extract these valuable minerals is driven by global demand, particularly from China, which controls nearly 90% of the world's rare earth processing capacity, and raises serious questions about the true cost of the green energy transition.

The Lure of Rare Earths

Rare earth elements (REEs) are a group of 17 metallic elements crucial for various modern technologies. They are categorized into light rare earth elements (LREE) and heavy rare earth elements (HREE). Myanmar is a significant source of heavy rare earth elements (HREEs) like dysprosium and terbium, vital for producing the powerful magnets used in electric vehicles and wind turbines. As the world shifts towards renewable energy, the demand for these elements has skyrocketed, turning Myanmar into a key player in the global supply chain.

China, the dominant force in rare earth processing, has increasingly relied on Myanmar for raw materials. Faced with rising environmental concerns and stricter regulations at home, China has effectively outsourced much of its rare earth extraction to Myanmar, particularly to the Kachin State bordering China's Yunnan province. This outsourcing has led to a dramatic increase in mining activities in Myanmar since the 2021 military coup.

Environmental Catastrophe in Kachin State

The environmental impact of rare earth mining in Kachin State is devastating. The primary method used for extraction involves injecting harsh chemicals, such as ammonium sulfate, into mountainsides to leach out the rare earth minerals. This process results in highly toxic waste that contaminates soil and waterways.

Reports from organizations like EarthRights International and Myanmar Resource Watch detail the alarming consequences:

• Water Contamination: Rivers and streams are heavily polluted with heavy metals and radioactive elements, rendering them unsafe for drinking and household use. Mass fish deaths and livestock health issues, including tumors, have been reported due to the polluted water. In Chipwi Township, over 96% of households lack access to clean drinking water.
• Soil Degradation: The expansion of mining activities has led to the loss of ancestral farmlands and severe soil contamination. Farmers face economic hardship as contaminated crops are rejected for export.
• Air Pollution: Air pollution from rare earth processing activities has caused a significant decline in crop yields and quality.
• Deforestation: Illegal rare earth mining is responsible for the deforestation of one of the world's most biodiverse rainforests. Satellite imagery shows mining operations covering an area around the size of Singapore.

The long-term effects of this environmental destruction are dire, threatening the health and livelihoods of local communities and the region's biodiversity. Leachate from mining sites, even those out of use for a decade, continues to emit toxic heavy metals like arsenic and cadmium at levels far exceeding safe human exposure limits.

Human Rights Abuses and Social Disruption

The rare earth mining boom in Myanmar is not only an environmental disaster but also a human rights crisis. The industry operates largely unregulated, with little regard for the safety and well-being of local communities.

Key human rights concerns include:

• Forced Displacement: Mining expansion has displaced many people from their towns and villages, leading to conflicts over land ownership and compensation disputes.
• Health Problems: Communities living near mining sites report health issues such as osteoporosis, respiratory diseases, and gastrointestinal, skin, and eye problems, mirroring those previously seen near mining sites in China. An increase in miscarriages among female workers has also been attributed to environmental contamination.
• Loss of Livelihoods: The collapse of traditional livelihoods, such as agriculture and livestock farming, has led to unemployment and economic hardship for many residents.
• Increased Social Problems: Incidents of drug abuse and sexual violence have reportedly increased in mining areas.
• Lack of Transparency and Community Marginalization: Compensation processes are often opaque, and locals do not directly benefit from mining profits. Communities face threats and intimidation from armed groups and private companies if they oppose mining projects.

Conflict and Geopolitics

The rare earth mining industry in Myanmar is deeply intertwined with the country's ongoing civil conflict. The mines are primarily located in Kachin State, a region that has seen decades of struggle between ethnic communities and the Myanmar military for greater political autonomy.

Following the 2021 military coup, the situation has become even more complex. Various armed groups, including military-backed entities and ethnic armed organizations (EAOs) like the Kachin Independence Army (KIA), control mining areas. These groups often profit from the trade, exacerbating the conflict and undermining stability.

Since late 2024, the KIA has taken control of key rare earth extraction areas, leading to rising tensions with local communities opposing mining operations. Civilians resisting mining activities have reportedly faced arrests and threats from armed groups.

China's involvement further complicates the situation. As the primary importer of Myanmar's rare earths, China has a vested interest in the region's stability. Beijing has been actively engaging with various stakeholders, including the Myanmar junta and ethnic armed groups, to ensure the continued flow of these critical minerals.

The Global Supply Chain and Corporate Responsibility

The rare earth elements extracted in Myanmar find their way into global supply chains, ending up in products manufactured by some of the world's leading companies. A Global Witness investigation revealed that heavy rare earth oxides imports from Myanmar to China more than doubled from 19,500 tons in 2021 to 41,700 tons in 2023. This makes Myanmar the single largest source of vital HREE.

Industry experts suggest that the use of heavy rare earths originating from Myanmar in EV motors manufactured by many western household brands is almost inevitable. This raises serious ethical questions about corporate responsibility and the need for greater transparency in the supply chain.

Organizations like EarthRights International are calling on corporations to conduct human rights and environmental due diligence, consult with Kachin civil society groups, and help remedy the environmental disaster they have helped to create.

A Crossroads for Myanmar and the Green Transition

Myanmar's rare earth boom presents a complex challenge. While the industry offers short-term economic opportunities, it comes at a tremendous cost to the environment, human rights, and long-term stability. The international community, particularly China, Europe, and the United States, must take action to address these issues.

Possible steps include:

• Enacting and enforcing human rights and environmental due diligence legislation.
• Supporting sustainable and responsible mining practices.
• Promoting transparency and accountability in the supply chain.
• Engaging with local communities and civil society organizations to ensure their voices are heard.
• Halting HREE mining until the extent of the harms caused can be established and safeguards in line with international standards are put in place.

The future of Myanmar and the global green energy transition depends on addressing the dirty secrets behind the rare earth boom and ensuring that the pursuit of clean energy does not come at the expense of vulnerable communities and the environment.