On Monday, December 1st, Japanese Prime Minister Sanae Takichi called for Saudi Arabia to collaborate with Japan in the development of rare earth mineral resources. During the US-China trade war, China weaponized rare earths by restricting exports, leading Western countries to worry about over-reliance on China for rare earth supplies. Countries including the United States started taking action to reshape the global supply chain.
In a report by Nikkei Asia on December 2nd, Sanae Takichi, while speaking at a future investment forum, warned that over-reliance on other countries for critical materials, including rare earths, has exposed supply risks.
This investment forum, sponsored by the Public Investment Fund (PIF) of Saudi Arabia, was held for the first time in Tokyo.
Takichi stated, “We will accelerate relevant efforts, such as cooperation between Japanese and Saudi Arabian companies, to promote supply chain cooperation among like-minded nations.”
Saudi Arabia claims to possess over $25 trillion worth of mineral resources, including gold, phosphates, and rare earths.
Takichi’s remarks come at a time when tensions between Japan and China over the Taiwan issue remain high. Previously, Takichi had mentioned the possibility of Japan intervening in Taiwan’s situation, sparking strong backlash from China.
In September 2010, a Chinese fishing boat collided with two Japanese Coast Guard vessels near the Diaoyu Islands. The fishing boat captain was detained until the investigation concluded, triggering a diplomatic dispute that led China to temporarily halt the export of rare earth metals to Japan. The Diaoyu Islands are currently under Japanese control, but China also claims sovereignty over them.
Rare earth resources may seem insignificant on the periodic table, but due to their unique physical and chemical properties, they are essential for many high-tech products such as laser-guided weapons, advanced aircraft, military night vision goggles, missiles, iPhones, electric vehicles, wind turbines, nuclear energy, and more.
“Our goal is to closely cooperate with like-minded countries around the world, including Saudi Arabia, to uphold and strengthen a rule-based, free and open international order, and to rebuild responsible global governance,” said Takichi.
Yasir Al-Rumayyan, CEO of the PIF of Saudi Arabia, stated at the forum, “Saudi Arabia can be a good partner for Asia, especially Japan, in terms of supply chains and critical minerals.”
Al-Rumayyan also serves as the chairman of the world’s largest oil company, Saudi Aramco, and the largest mining company in Saudi Arabia, Maaden. He mentioned the need to explore beyond oil and gas fields.
“I facilitated collaboration between these two companies, and now we are shortening exploration time. We know exactly where the mineral sites are, and we are using a lot of artificial intelligence and data to find the right sites,” he said.
The PIF manages assets worth about $1 trillion, derived from oil production and other sectors. The fund’s mission is to generate financial returns through investments and help Saudi Arabia reduce its dependence on oil, achieving economic transformation.
Currently, China monopolizes the global rare earth extraction industry, and rare earths are the foundation of many key technologies. As Japan plans to enhance cooperation with Saudi Arabia in the rare earth sector, the United States is also strengthening its ties with Saudi Arabia.
During Saudi Crown Prince Mohammed bin Salman’s visit to the White House to strengthen economic and security relations between the two countries, on November 19th, the US rare earth company MP Materials announced a partnership with the Pentagon and the Saudi state-owned mining company Maaden to build a rare earth refining plant in Saudi Arabia. This project aims to expand the processing capacity for critical minerals in the Middle East, reducing reliance on Chinese rare earths.
The facility under construction will refine rare earths from Saudi Arabia and other regions into heavy rare earth and light rare earth oxides, which have different applications in commercial and military sectors.
According to MP, the refined materials will be used in manufacturing and defense industries in the United States and Saudi Arabia, and sold to allied nations.