Myanmar, explained.
A protest in October against the rare earth deal between Thailand and the United States outside the Embassy of the United States in Bangkok (Peerapon Boonyakiat via Getty Images)
The clean energy transition comes at a cost to regional rivers that sustain tens of millions.
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Southeast Asia is paying the environmental price of the rare earth boomSoutheast Asia is paying the environmental price of the rare earth boom
Rare earth minerals are essential to the global clean energy transition. They are embedded in the permanent magnets that power electric vehicle motors and generate wind energy. China produces roughly 70% of the world’s rare earths and controls about 90% of processing capacity, giving Beijing significant leverage over supply chains. As China tightened environmental regulation domestically over the past decade, Chinese firms increasingly sourced minerals abroad, with parts of Southeast Asia becoming key extraction frontiers.
Myanmar is the most striking illustration of how this shift is unfolding. Since the military coup in 2021 further weakened already limited regulatory oversight, rare earth mining expanded rapidly across the country’s north. The number of active mining sites rose from about 130 in 2020 to more than 370 by 2024. In Chipwi alone, more than 2,500 leaching pits have been recorded. Chemical pools now scar forested hillsides in Kachin State, producing ores transported across the border to China for processing.
The consequences extend beyond the immediate mining sites. Rare earth deposits are typically found in low concentrations, meaning large volumes of earth must be processed to extract relatively small quantities of minerals. Chemical leaching contaminates groundwater and rivers, while poorly managed tailings can remain hazardous for decades. When extraction spreads across entire landscapes rather than isolated deposits, the ecological damage becomes exponentially harder to repair.
The contamination is no longer contained within Myanmar’s borders. Water samples taken from Thailand’s Kok River in mid-2025 carried the same “fingerprint” of heavy metals found in Myanmar’s Kachin State, with testing attributing 60 to 70 per cent of the contamination to rare earth mining. As a result, the Mekong Basin, which supports the world’s largest inland fishery and sustains the livelihoods of tens of millions of people, is increasingly at risk.
What is unfolding in Myanmar may therefore foreshadow wider regional pressures. Vietnam holds some of the world’s largest rare earth reserves and is pursuing extraction targets of up to 60,000 tonnes of processed oxides annually by 2030. Early expansion has raised concerns about deforestation, toxic tailings, and water contamination in northern mining regions. Meanwhile, satellite analysis shows at least 27 rare earth mines have opened in Laos since 2022, some near protected areas. Across Southeast Asia, economic opportunity tied to Chinese import demand is increasingly accompanied by environmental risk.
When extraction spreads across entire landscapes rather than isolated deposits, the ecological damage becomes exponentially harder to repair.
The underlying economic logic is not difficult to understand. Governments in Southeast Asia are eager to attract investment tied to the energy transition. Rare earth mining promises export revenue, infrastructure development, and employment. When countries compete for that investment, environmental safeguards can quickly become a commercial disadvantage. Operators shift to wherever regulations are weakest, or enforcement is least consistent.
Avoiding that outcome will require stronger regional coordination. Regional environmental standards could help reduce the race to the bottom. Countries in Southeast Asia should work towards common baselines for rare earth mining and processing. ASEAN already has frameworks for environmental cooperation and minerals development that could be adapted for critical minerals. Regional standards would reduce incentives for regulatory undercutting among neighbours and provide investors with clearer expectations for responsible extraction.
Equally important, supply-chain traceability must extend all the way to the mine. Processors and buyers must take greater responsibility for environmental and social conditions at the mining source. Third-party audits, procurement policies, and meaningful traceability requirements are technically feasible and already used in other mineral sectors. What remains lacking is the commercial and regulatory pressure needed to implement them consistently. Chinese regulators, alongside major importing jurisdictions in Europe and North America, are central creating that pressure through transparency requirements and responsible-sourcing standards.
Governments in Southeast Asia also need to think carefully about where mining should and should not occur. Governments need to systematically map overlaps between mineral deposits and biodiversity assets before extraction begins, identify areas where ecological costs are too high to justify mining, and designate certain landscapes as off-limits. Such planning through systematic environmental assessment and land-use zoning is far less costly than managing the ecological and social fallout of poorly sited projects approved under investment pressure. In the Mekong Basin in particular, transboundary coordination is essential because upstream decisions in Myanmar or Laos directly shape downstream outcomes in Cambodia and Vietnam.
Finally, environmental assessments must be required to measure cumulative effects across the entire ecosystem. Countries that meet agreed biodiversity and watershed-health benchmarks at the national level should receive preferential access to green finance and reduced-rate export credits. This approach creates positive incentives for high-standard governance rather than relying solely on prohibitions, and it rewards countries that choose to manage extraction responsibly.
Rare earth elements will remain indispensable to the global energy transition for the foreseeable future, and demand will continue to grow. As supply chains expand and diversify, that expansion must occur within stronger environmental safeguards. China sits at the centre of this system as the world’s dominant processor, a major investor in upstream projects across the region, and a key manufacturer of downstream technologies. Regional baselines, traceability requirements, spatial planning, and cumulative assessment are available tools. The window to apply them is narrow and closing fast.
About the author
Mohd Yunus
Mohd Yunus is an independent researcher hailing from Riau Province, Indonesia, and is currently pursuing a master’s degree in biological sciences at Khon Kaen University, Thailand.
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