US Backs Madagascar Rare Earths Project in Strategic Push to Counter China’s Mineral Dominance

Washington pledges initial funding to the Ampasindava project, aiming to build Western-controlled supply chains for critical minerals essential to defense, technology, and green energy.

The United States has announced its backing of the Ampasindava rare earths project in Madagascar, marking a significant step in Washington’s broader strategy to build Western-controlled critical mineral supply chains and reduce global reliance on China.

According to recent reports, the US International Development Finance Corporation (DFC) has pledged up to $4.84 million to fund pilot plant operations, laboratory analysis, and environmental initiatives for the project. While this initial commitment represents a fraction of the estimated $150 million required for full-scale development, London-listed Harena Rare Earths, the project’s owner, views it as a foundational step toward securing more substantial US financing during the construction phase.

Countering Strategic Competitors

The move aligns with a concerted US State Department effort to expand American investment in African mining industries, particularly in regions where Washington’s geopolitical competitors have historically held sway.

A US State Department spokesperson emphasised that the strategy is designed to challenge what the administration describes as “opaque, predatory investments from our adversaries.”

“Madagascar fits within that strategy, and we see opportunities throughout the country to increase U.S. and U.S.-aligned investment in the critical mineral sector,” the spokesperson stated in a recent briefing.

For years, Chinese companies have maintained a formidable presence in Africa’s copper, cobalt, and lithium industries. Furthermore, Beijing’s near-monopoly on global rare earth extraction and processing has been underscored by recent export restrictions, demonstrating China’s leverage over supply chains vital to the global defence, electric vehicle, and renewable energy sectors.

Minerals Critical to Modern Technology and Defence

The Ampasindava deposit is an ionic clay site rich in neodymium, praseodymium, dysprosium, and terbium. These elements are indispensable for manufacturing high-strength permanent magnets, which are heavily utilised in advanced military technologies—including fighter aircraft and precision-guided weapons—as well as in civilian electronics and green energy infrastructure.

Harena Rare Earths projects that the mine will produce approximately 4,000 metric tons of rare earth oxides annually. Of this, around 1,700 tons will consist of higher-value magnet materials, specifically neodymium-praseodymium and dysprosium-terbium compounds.

Path to 2028 Production

Harena Executive Chair Ivan Murphy confirmed that the company has applied for a formal exploitation permit and anticipates a regulatory decision in the near future. The company has set a target to commence commercial production at Ampasindava by mid-2028.

In a bid to fully decouple from existing geopolitical vulnerabilities, Harena is also actively exploring options to refine the extracted materials within the United States or Europe, deliberately bypassing Chinese-controlled processing networks.

As the global race for critical minerals intensifies, Madagascar’s Ampasindava project is poised to become a key focal point in the broader US-China competition for resource security and technological supremacy.

Reference: Al-Mayadeen