00:10Hello and good evening. I'm Melissa Idris. Welcome to Consider This. This is the show
00:15where we want you to consider and reconsider what you know of the news of the day. The
00:19government may ease its moratorium on exporting raw rare earth elements which it introduced in
00:252024 to encourage domestic processing within the country but now the federal government says it's
00:32facing pressure from both state governments as well as investors from other countries. So is
00:39Malaysia reconsidering the moratorium because the economics and the geopolitics has changed
00:45or is it because the original strategy of building domestic value-added capacity has not moved quickly
00:52enough. Well joining me on the show to discuss this further I have Nick Nazmi and Nick Ahmad who
00:57is the former natural resources and environmental sustainability minister. Thank you so much for
01:02joining me on the show. So I'm just wondering when the moratorium was first introduced and we
01:07the argument was that we should capture a lot more value domestically by developing some of the
01:13downstream industries here. What do you think has changed to make Putrajaya now reconsider that
01:21moratorium and do you think this is a good thing? Yeah well I think as mentioned the original intention
01:30was to for Malaysia to be able to capture the full value or at least a lot of the value
01:36that comes from
01:38rare earth processing and mining. Traditionally you know with regards to our minerals we've always been
01:47we tend to be exporting the raw materials while other countries have been able to capture the value.
01:54I would say one successful exception would be oil and gas where through Petronas we've built
02:02you know a very solid complete oil and gas industry for over 50 years.
02:11the benefit that Malaysia has is that we've had for many years Linus which is an Australian-owned rare earth
02:21processing plant in Pahang but we must also bear in mind that Linus is the biggest processing plant outside China
02:32uh but China dominates uh the mining and the processing of rare earth globally um and uh because of the
02:42cold war
02:42tensions I mean the the rivalries um there is basically you know basically the idea is we also have
02:50uh apply sorry a mine our pilot mine in Perak is owned by uh is uh using Chinese technology
02:58um and economics because of the relations between China and the US or its allies so um I know that
03:07we've
03:07got initially in the past um indications from China that they're interested to open a processing plant in
03:13Malaysia um and I know that other than Linus there's been other talks of processing plants opening up
03:20um in Malaysia by by either US or western countries as well um but I guess um we have to
03:27be realistic that
03:29some of this may take years uh to come into reality there's a lot of geopolitical uncertainty
03:36um and as you mentioned um the states are uh you know they want to get some value um from
03:42these minerals
03:43and for the state it tends to be uh raw materials uh so I can understand why this um change
03:51in policy um I
03:53don't have the a lot of the details but from what I understand is that the government is still trying
03:59to
03:59get some commitments from um the miners whether you know to have some technology transfer um to build at
04:07other parts of the supply chain um some uh processing facilities or for the byproducts or for the products
04:15of uh red earth I think it should be looked in its totality um but we should be really careful
04:21and there
04:21should be a real timeline being designed so that we should eventually go back to that ban of raw exports
04:28right okay so so talk to me a little bit about that some of the commitments some of the safeguards
04:34that we actually need to have in place so if there is a commercial pressure or maybe a commercial
04:41even necessity at this point to maybe ease the moratorium what do we need to do what commitments
04:46would you like to see um Malaysia press for to make sure that we don't simply become as you said
04:52another
04:53source of cheap minerals for other countries yeah so I think one of the things that we can do is
04:59that
04:59we can allow for the exports of um uh what do you call that rare earth uh but we have
05:06to put in a
05:07timeline that um uh you know that eventually after a certain number of years um the companies will have
05:15to find ways um to build processing plants um in Malaysia um and beyond that you know we've already
05:23started i think um there's been a jv signed between linus and a south korean company for super magnets
05:28which is further down the value chain and all that so we want to see in its totality whether we
05:34can get
05:35these companies to um build more and more of the rare earth supply chain in the country so maybe you
05:41know give
05:42them five years um have very strict uh export quotas um you know because in the past as well during
05:50my time
05:50we give because of the chinese mine chinese uh technology mine in perak then we give them a certain amount
05:58to export uh but we should then you know gradually reduce that amount uh meaning that if they do want
06:05to
06:05capture the value from the minerals then they have to process it uh in uh uh in Malaysia you brought
06:14up
06:14a great point the fact that rare earths have become so entangled in geopolitical competition
06:20how does that affect how we maneuver this uh if we want to ease the moratorium then we will have
06:29to
06:30choose partners how does the geopolitical competition affect malaysia's room to maneuver i think we are
06:37perfectly look um you know we are we're in a good position linus is uh of course australian ally of
06:44the us
06:45it's been here for many years it's for the first time it's gotten its long-term uh license uh and
06:51i think
06:51that helps to secure the like uh super magnet players to be based in uh malaysia uh but at the
06:59same time
06:59our pilot uh rare earth mine was operated by uh a chinese firm right so um and we are again
07:09a country
07:10that trades uh openly with both countries um so i think we just have to continue to maintain that fine
07:16line and people have to respect malaysia as a sovereign country that we make our own choices we do not
07:22want to
07:22be stuck uh or you know committed to just one uh superpower um i think the west is really investing
07:30a
07:31lot now because they allow china to dominate the space for many many decades um and and i think that
07:38we we should uh you know use that to in order to get the best for the country um you
07:43know and we can get
07:44the best for and this will be high-end workers um of course i don't think malaysia will be able
07:49to
07:49cater for everything because a lot of these are very specialized knowledge but then you know uh
07:55meaty and all that you can put in um um in the requirements about uh the development of malaysian
08:01thailand uh i know some of it has been done for example by linus but we can do it in
08:06a more concerted
08:06effort uh so that it's not just that people come to malaysia for the minerals but they come here
08:12because they are processing plants because there are super magnet factories and because there's
08:18talent specialized talent malaysian talent that are able to work in this factory so if we can create
08:24that um then that would be you know uh the minerals it's finite but uh talent technology that is something
08:33that we can continue to rely on into the future right um can you reflect on your time when you
08:38were
08:39in government and i know in this portfolio that the when we talk about rare earths the environmental
08:47and health concerns loom large and it's not just rare it's all mining projects right um and recently
08:54there's also been controversy around some of the process in the mineral processing projects here
08:58in malaysia so how important is it to have um social license when we think about or when the government
09:07thinks about uh shaping malaysia's rare earth ambitions yeah i mean i think it's fair it's a
09:13fair demand uh there are valid concerns and you know historically malaysia because of the asian
09:18rare earth incident uh in the 80s um and that has become a nightmare um for many malaysians when they
09:25hear the word rare earth um and of course there were valid concerns as well with regards to linus
09:31um but i think you know the government has stepped up in its uh requirements um for linus um and
09:39again i
09:39think the the fact of the matter is that because linus used to you know it started as processing um
09:45minerals that came from australia so the idea is that this is something that australia did not want and
09:51they wanted to locate it here but i think we also have to be we also have to be open
09:56you know uh if we talk
09:58about wind turbines we talk about batteries we talk about many things that are related to the green
10:03transition red earths are an important component um but maybe yes i agree that uh we need to relook at
10:11our eia requirements we need to look at our uh you know the licensing with regards to um atomic energy
10:18um because some of this uh are radioactive uh particularly those that are imported the minerals
10:24um so that um you know we can really give assurance to the public that um their interests are taken
10:31care
10:32of uh i think some of it has been um done by the government but um you know the people
10:37demand the
10:38higher standards and um we do not want to be doing these things simply because we have uh much more
10:44relaxed uh environmental or safety laws we want to be able to be doing these things because um of the
10:52the
10:52fact that we are able to provide a stable business environment uh of course we have the minerals but
10:58also that we can provide a supply chain and to be doing it in a way that is safe and
11:04uh you know take
11:05cares of everyone's health right okay so so nazmi looking at everything that's just been said do you
11:11think that lifting the export moratorium would be in malaysia's best interest i believe that it can be in
11:21our best interest in the short term um provided again that we have all those conditions and all that
11:27we have a proper plan moving forward um and and not looking at this um allowing this uh export to
11:35be
11:35something that is permanent and unconditional okay so temporary is thank you so much for joining
11:42me on the show nick nazmi nick ahmad their former natural resources and environmental sustainability
11:47minister we're going to take a quick point here and consider this we'll be back with more stay tuned
11:52you
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