OCT 15 — Malaysia stands at a crossroads. The discovery of sizeable deposits of rare earth elements (REEs)—those seventeen obscure metals critical to the high-tech and green economy—presents a tantalising prospect. These minerals are the building blocks of everything from electric vehicle motors and wind turbines to smartphones and advanced defence systems. Yet, the path to this wealth is fraught with peril.

The deposits reside not in barren, rocky outcrops, but beneath our nation’s sensitive and irreplaceable forest ecosystems. The spectre of environmental degradation, water pollution from chemical processing, and the irreversible loss of biodiversity looms large. The question, therefore, is not whether we should pursue this resource, but how we can do so with an unwavering commitment to our natural heritage.

The allure is undeniable. The global race to secure supply chains for critical minerals is accelerating. China’s current dominance in the REE market has nations from the United States to Japan scrambling for alternative, reliable sources. Malaysia has a chance to position itself as a key, responsible player in this new geopolitical landscape. The economic benefits—job creation, high-tech industrial development, and significant export revenues—could provide a substantial boost to the national economy for decades to come.

However, we must learn from history. The environmental and health scars left by previous rare earth processing in Malaysia serve as a permanent cautionary tale. We cannot afford to repeat the mistakes of the past. The "how" of extraction is everything. Simply auctioning off tracts of forest to the highest bidder, employing outdated and hazardous methods, would be an act of profound short-sightedness, trading long-term ecological health for short-term gain.

Therefore, Malaysia must adopt a doctrine of Responsible and Regenerative Extraction. This is not an oxymoron but a necessary evolution in how nations manage natural resources in the 21st century. Here is how we can achieve it: First, elevate environmental assessment to a non-negotiable standard. Before a single tree is felled, we must employ the most stringent, transparent, and science-based Environmental Impact Assessments (EIAs) ever conducted in the country.

These assessments must be made fully public and subject to independent international scrutiny. The proposed "in-situ leaching" method, which involves pumping solution into the ground to dissolve REEs and pumping the leachate back out, must be rigorously tested and monitored. Its potential to contaminate groundwater is the single greatest risk and must be mitigated with precision.

Second, legislate a "Zero-Harm" framework. The government must enact a specific Rare Earth Act that mandates the highest international standards for water management, waste disposal, and site rehabilitation. Companies must be required to post significant performance bonds—financial guarantees that are forfeited if they fail to meet their environmental obligations. The principle of the "polluter pays" must be enshrined in law and practice. Third, integrate extraction with advanced, on-shore value addition.

The real economic prize lies not just in digging up rocks, but in moving up the value chain. Instead of exporting raw ore, we must incentivise the establishment of state-of-the-art processing and refining facilities in designated industrial zones. This creates higher-skilled jobs, captures more of the economic value, and allows for stricter centralised control over the most toxic part of the process, separating it from the pristine extraction sites.

Fourth, practice radical transparency and engage local communities. The trust deficit is real. The government and operating companies must commit to live, publicly accessible data on water quality, emissions, and environmental metrics. Local communities, especially indigenous groups, must be engaged as stakeholders from the outset, not as an afterthought. Their free, prior, and informed consent is both a moral imperative and a practical necessity for social license to operate.

Finally, invest the proceeds into a sovereign green fund. A significant portion of the royalties and taxes generated from this industry should be funneled into a future fund dedicated to conservation, renewable energy projects, and climate adaptation initiatives. This ensures that the wealth from beneath the ground is directly used to protect and enhance the world above it for future generations.

The choice before us is not a binary one between poverty and pollution. That is a false dichotomy. Malaysia has the intellect, the regulatory potential, and the moral compass to pioneer a third way. We can demonstrate to the world that economic development and environmental stewardship are not mutually exclusive.

By harnessing our rare earth wealth with prudence, innovation, and an iron-clad commitment to our forests, we can do more than just power the global green economy. We can show the world how to build one. The opportunity is not just to extract minerals, but to extract them rightly—and in doing so, define Malaysia’s role as a responsible and forward-thinking nation.  

The author is affiliated with the Tan Sri Omar Centre for STI Policy Studies at UCSI University and is an associate fellow at the Ungku Aziz Centre for Development Studies, Universiti Malaya. He can be reached at ahmadibrahim@ucsiuniversity.edu.my.  

** This is the personal opinion of the writer or publication and does not necessarily represent the views of Malay Mail.