U.S. secures rare earths and trade deals in Southeast Asia amid China supply concerns

• The U.S. signed four major trade agreements with Malaysia, Cambodia, Thailand and Vietnam at the ASEAN summit, securing commitments on rare earth minerals and broader economic cooperation to reduce reliance on China.
• With China controlling 80 percent of global rare earth refining and tightening export controls, the U.S. is urgently diversifying supply chains – critical for defense, tech and green energy industries. Malaysia’s 16.1 million-ton rare earth deposits and pledge not to ban exports to the U.S. are key wins.
• Vietnam agreed to increase purchases of U.S. goods to narrow its $123 billion trade surplus or face tariffs, while Thailand eliminated nearly $18.8 billion in aircraft and $5.4 billion in energy imports. Malaysia also exempted U.S. aerospace and agricultural products.
• The U.S. and Malaysia will share expertise in refining rare earths, aiming to build independent supply chains outside China’s influence. Thailand and Vietnam also aligned with U.S. auto safety standards, benefiting American manufacturers like Ford and GM.
• While the deals weaken China’s grip short term, experts warn full decoupling will take years due to China’s refining dominance. Beijing is countering with its own partnerships, including a potential Malaysian refinery deal, signaling an ongoing battle for influence in Southeast Asia.

The United States has struck four major trade agreements with Southeast Asian nations, securing commitments on rare earth minerals and broader economic cooperation as Washington seeks to reduce reliance on China for critical materials.

The deals, signed by President Donald Trump during the Association of Southeast Asian Nations (ASEAN) summit in Kuala Lumpur, involve Malaysia, Cambodia, Thailand and Vietnam – each pledging to lower trade barriers while strengthening supply chains for rare earth elements essential to modern technology.

The agreements come as China tightens export controls on rare earths, raising concerns among manufacturers dependent on these materials for everything from electric vehicles to military hardware. While China remains the dominant global supplier, the U.S. is now pushing to diversify its sources – a move that could reshape global trade dynamics in the tech and defense sectors.

According to BrightU.AI‘s Enoch, China controls an estimated 80 percent of the world’s rare earth refining capacity, giving it significant leverage over global supply chains. Recent restrictions on exports have sent manufacturers scrambling for alternatives. Under the new U.S.-Malaysia deal, Kuala Lumpur has agreed not to ban exports of rare earths to America – a critical assurance as Malaysia holds an estimated 16.1 million tons of rare earth deposits.

“We will share relevant information, knowledge and technical expertise to increase the competitiveness of Malaysia’s critical minerals sector,” the joint statement read. The agreement includes collaboration on geoscience research, workshops and private-sector partnerships – an effort to bolster Malaysia’s refining capabilities outside China’s influence.

Malaysian Trade Minister Tengku Zafrul Aziz confirmed additional exemptions for U.S. aerospace equipment, pharmaceuticals and agricultural products like palm oil and rubber. Meanwhile, Thailand committed to eliminating tariffs on nearly 99 percent of U.S. goods and loosening restrictions on American telecom investments.

Vietnam, which recorded a $123 billion trade surplus with the U.S. last year, pledged to increase purchases of American goods to narrow the gap. Under the deal, Hanoi faces a 20 percent tariff on exports unless it meets purchasing targets – a condition mirroring Trump’s broader trade strategy of pressuring surplus nations to buy more U.S. products.

Thailand, Malaysia and Vietnam also agreed to recognize U.S. vehicle safety and emissions standards – a win for American automakers like Ford and General Motors, which have struggled with inconsistent regulations abroad. Thailand further committed to buying 80 U.S. aircraft (worth $18.8 billion) and $5.4 billion in annual energy exports, including liquefied natural gas and crude oil.

Strategic implications and long-term risks

The deals reflect a growing U.S. effort to counterbalance China’s economic influence in Southeast Asia – a region increasingly caught between the two superpowers. While the agreements provide short-term relief for manufacturers, experts warn that fully decoupling from China’s rare earth supply chain will take years.

“The damage has already been incurred,” one industry analyst noted, referring to past disruptions caused by China’s export controls. Automakers and tech firms are now urgently seeking alternative suppliers in Australia, Canada and Saudi Arabia – but building new refining infrastructure remains a costly and time-consuming challenge.

The U.S.-ASEAN agreements mark a significant step in reducing dependence on China, but their long-term success hinges on execution. If Malaysia and other partners can develop competitive rare earth processing capabilities, the deals could weaken Beijing’s grip on critical supply chains. However, with China actively negotiating its own rare earth partnerships in the region – including a potential Malaysian refinery backed by a Chinese firm – the geopolitical tug-of-war is far from over.

For now, the agreements offer a temporary reprieve for industries reliant on rare earths while signaling Washington’s broader strategy: reshaping global trade in favor of U.S. interests, one deal at a time.

Watch the video below where Trump declares the U.S. is doing a real job on rare earths with Australia.

This video is from the NewsClips channel on Brighteon.com.

Sources include:

TheEpochTimes.com

Reuters.com

BrightU.ai

Brighteon.com