The deal covers trade, joint investment, and rare earth processing cooperation.
Over the weekend at the ASEAN-U.S. Business and Investment Summit in Kuala Lumpur, President Donald Trump and Malaysian Prime Minister Anwar Ibrahim signed a Memorandum of Understanding (MoU) on critical minerals, marking a major step in U.S.-Malaysia economic and resource cooperation. The MoU commits both countries to strengthening collaboration across the entire critical minerals supply chain, from exploration and extraction to processing, manufacturing, recycling, and recovery, while promoting resilient, secure markets for rare earth elements.
Malaysia, home to major rare earth processing facilities including those operated by Australia’s Lynas, pledged preferential market access for U.S. chemicals, machinery, metals, passenger vehicles, and agricultural exports. The MoU is also accompanied by a trade agreement addressing digital trade, services, and investment, while restricting unauthorized transfers of U.S.-controlled items. Under the deals, the two countries will prioritize U.S. investment in Malaysia’s critical minerals sector and coordinate policies to protect domestic markets from unfair trade practices.
However, besides the U.S., China is also interested in greater cooperation with Malaysia on rare earth elements: earlier this month, media reports suggested that the two discussed potential collaboration (we reported).
At the same summit, the U.S. also inked trade and investment agreements with Cambodia, Thailand, and Vietnam, the latter notably home to substantial rare earth reserves. On the sidelines, U.S. officials also held preliminary talks with Chinese representatives on rare earth exports and tariffs, paving the way for Trump and Xi Jinping to consider a framework agreement later this week.
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