<Special Focus>Rare Earth Plant in Malaysia: Governance, Green Politics, and Geopolitics

Abstract

A rare earth elements (REE) extraction plant was built and began operating in Gebeng, Malaysia (near the city of Kuantan), from early December 2012. This plant, slated to be the world's largest when it operates at full capacity, is very controversial in Malaysia. Various factors appear to have influenced the setting up of this foreign-owned REE extraction plant, although the source of its raw material is thousands of kilometers away in the desert of Western Australia. This article examines and discusses the reasons why the Malaysian authorities approved the highly controversial project despite the fear of the local community that it would have significant negative impacts on the environment and the health of the public, and despite major protests (some of which were nationwide) against the project. The decision by the Malaysian authorities to approve it was probably due to factors such as the importance of rare earth metals in high-technology production; geopolitical considerations, with China dominating and supplying most of the market; high rare earth prices because of actions taken by the Chinese authorities; differences in environmental laws and their enforcement between Malaysia and Australia; and poor governance and lack of citizen input into public decision making in Malaysia. This article demonstrates how a seemingly local issue—specifically, strong objection by local residents to an industrial project—is linked to broader issues such as governance, regional and national politics, and the geopolitics of access to critically important mineral resources. It also discusses various ethical issues in relation to the controversial project.