US President Donald Trump ratchets up his economic showdown with China, and his government is tentatively eyeing a new battlefield — Myanmar. The Southeast Asian nation is one of the world’s leading producers of rare earths and one of China’s principal sources.
With China virtually having a monopoly on these critical minerals used in electronics and defence, Trump seems to be considering options that involve both courting Myanmar’s military junta and rebel groups to divert control of rare earth supply chains from Beijing.
The action represents a possible reversal of US policy since the 2021 coup and might enlist Quad allies such as India for extraction and refining.
China’s Grip on Rare Earths: Strategic Vulnerability for the US
Rare earths are a necessary component of modern technology — from smartphones and electric vehicles to missiles and fighter planes. Of the 17 minerals that are considered rare earths, China processes almost 90% of the world’s production. Although America has some rare earth deposits, it does not have the large-scale refining capacity, so it is reliant on Beijing.
In previous trade showdowns, China used this leverage, threatening to cut off supply. That tactic worked, pinning Washington between bilateral deals. Trump’s re-election and his second trade war have seen US policymakers revisit rare earth diversification, and Myanmar has become the key to that puzzle.
Trump Reverses Myanmar Policy
US had isolated Myanmar’s junta after the 2021 coup that removed the civilian government from power. Signs of a change, however, have begun to appear. Trump has called Myanmar’s military chief, Min Aung Hlaing, the “head of state” and withdrawn sanctions from the regime. This represents a change fueled less by diplomacy and more by competition for resources.
Trump’s administration is now seriously considering proposals to create ties with the junta and rebels, including the Kachin Independence Army (KIA), which controls significant rare earth regions in northern Myanmar, the sources said.
Slash Tariffs, Broker Peace, Dig Out Minerals
The plans on the table are ambitious and outside the box. One is for the US to directly negotiate with the KIA in order to gain access to rare earth deposits. Another is to broker a peace accord between the junta and the KIA, with the U.S. acting as mediator.
Adam Castillo, the ex-president of the American Chamber of Commerce in Myanmar, presented these suggestions in a meeting with Vice President JD Vance’s office. He highlighted the fact that the rebels are now more cautious of China, blaming Beijing for exploitation. Castillo urged the United States to present an alternative, one that involves reductions in tariffs — most notably the 40% tariff that Trump had placed on Myanmar — and a way toward cooperation.
To manage such an arrangement, Castillo also suggested that the U.S. appoint a special envoy for Myanmar’s rare earths industry. He urged trilateral partnerships between India and other Quad countries to process resources, transport, and refine.
Will India Join the US in Myanmar?
What makes this initiative unique is India’s potential contribution. The proposals advanced to Trump’s team include cooperating with India — a Quad ally and regional counterweight to China — for the processing and logistics of rare earths. India already possesses modest rare earth production capacity and has a common strategic interest in diluting Chinese influence along Myanmar’s border areas.
Were this achieved, it would be one of the first resource-based trilateral initiatives involving Washington, New Delhi, and a Southeast Asian nation — one that the Biden administration shied away from out of rights concerns.
Risky Gambit in a Fragile State
Opening up Myanmar’s rare earths to the US could cut America’s reliance on China. However, it has the potential to legitimise a military regime and interfere in an unstable civil war. With wide swaths of Myanmar already under rebel control, any attempt to negotiate with them — with or without junta cooperation—could trigger fresh conflict.
Meanwhile, as Washington attempts to recast the terms of resource access in a China-dominated world, Myanmar could become the unexpected battleground. The question now: just how far will Trump go to shatter China’s control over rare earths?
