Myanmar's military-led government is urging the United States to deepen its engagement with the country and invest quickly in its rare earth mines, a sector now dominated by neighbouring China. The appeal, reported by Reuters on Tuesday, casts the country's mineral wealth as a shared interest for Washington and Naypyidaw at a time when the United States is trying to loosen Beijing's grip on the supply chains behind modern technology.

The pitch was set out in a newsletter published on Monday by DCI Group, a Washington lobbying firm working on behalf of Myanmar's information ministry. In it, the firm argued that the United States should treat Myanmar as a critical minerals priority rather than simply a diplomatic challenge. "Minerals are the natural place for this deepening relationship to grow, since they connect Myanmar's economic potential to US national security and supply-chain priorities," the newsletter said.

The lobbying push follows a strategy document released by the US State Department last week, after months of secretive talks between American and Myanmar officials. The document outlines a plan to expand American influence in Myanmar and potentially gain access to its rare earth deposits. It marks a further step in a shift that began in September, when Washington held direct talks with Myanmar's military-backed leadership for the first time since the 2021 coup, reversing years of policy aimed at isolating the generals. After the coup, the United States froze Myanmar's assets at the Federal Reserve Bank of New York and imposed sanctions on its military leaders.

A sector dominated by China

Myanmar is one of the world's main sources of heavy rare earths, the minerals used to make the powerful magnets inside electric vehicles, wind turbines and other high-tech products. Almost all of the ore mined in Myanmar is trucked across the border to China for processing. China produces around 90% of the world's rare earth magnets and has recently tightened its control of the sector, imposing export controls and banning the transfer of rare earth processing and magnet-making technology.

The trade has grown sharply since the coup. Myanmar supplied rare earths worth $1.4 billion in 2023, accounting for most of China's feedstock, according to an estimate by campaign group Global Witness cited by Reuters. Kachin State in the north accounts for about 80% of Myanmar's rare earth mines, but mining in Shan State has expanded faster, averaging 48% annual growth, while mining areas in territories controlled by China-aligned armed groups tripled between 2024 and 2025, according to the Stimson Center.

There is a major complication for any American investor. Myanmar's main rare earth production sites in northern Kachin are not controlled by the government in Naypyidaw but by the Kachin Independence Army, a long-standing rebel group fighting the military. The group seized control of the mining area from military-aligned border militias in October 2024, and Myanmar's military has since renewed its offensive in the region. Largely unregulated mining in Shan State has also polluted rivers downstream, with toxic runoff and arsenic contamination crossing into neighbouring Thailand and Laos, according to the International Crisis Group.

Washington's cautious opening

Washington's new strategy aims to secure at least three major commercial or investment deals valued at more than $5 million each for US companies. DCI Group described that target as modest, given Myanmar's mineral resources and America's stated ambition to compete with China, adding that Chinese companies and intermediaries had spent years building their position in Myanmar's resource sector and held advantages that would not be easily displaced.

A US State Department spokesman told Reuters that Washington was encouraging Myanmar to make progress on key priorities, including improving the domestic operating environment for US businesses and building towards a genuine peace process that stabilises the country. President Donald Trump has made rare earths a national security priority since returning to office, pouring billions of dollars into companies in a bid to loosen China's grip on the sector.

China's foreign ministry and Myanmar's military-led government did not immediately respond to Reuters' requests for comment. No investment deal has been announced, and the US strategy document does not spell out whether Washington intends to lift sanctions or address the compliance concerns that deter investment in Myanmar. For now, the lobbying campaign amounts to an invitation: Myanmar is offering its minerals as the foundation of a closer relationship, while the practical obstacles of war, sanctions and Chinese dominance remain firmly in place.