ASEAN Beat | Economy | Southeast Asia

Vietnam and the Geopolitics of Critical Minerals

While Washington builds coalitions, Vietnam is betting on self-reliance.

At a symposium on economic security at Oxford’s Nissan Institute on March 5, covering topics from international cooperation and competition in exports, the private sector, and technology, one phrase echoed across nearly every panel discussion: critical minerals. 

Minerals like cobalt, lithium, nickel, and rare earth elements, once little more than obscure entries in geology textbooks, are now central to geopolitics. These resources power electric vehicles, wind turbines, semiconductors, and advanced weapons systems – all the technologies that define economic security and military power in the 21st century. The offensive or defensive moves that states now take to bolster their “supply chain resilience” are underpinned by their access to critical minerals. 

That shift is forcing governments to rethink the politics of resources. For decades, resource geopolitics revolved around oil and gas. Oil price rises (as we are seeing at the time of writing) can wreak havoc on inflation, but geostrategic contests increasingly concern the minerals that enable the whole economy.

In response, the United States is attempting to build alliances among “like-minded” countries to diversify supply chains and reduce dependence on China. 

Vietnam, by contrast, appears to be pursuing a more independent strategy. In December 2025 the government further entrenched its restrictions on the export of unprocessed rare earths in an effort to build domestic refining capabilities and preserve strategic autonomy.

This different approach raises questions about why an emerging middle power would abstain from a U.S.-led alliance. How did the Vietnamese government come to this position and why is it – one of the countries with the greatest reserves of rare earths and a partner of the U.S. in other contexts – acting alone? What lessons does it offer to other resource-rich states who may increasingly see minerals as tools of industrial policy and economic statecraft?

The U.S. Alliance Strategy: Collaboration to Reduce China’s Critical Minerals Chokepoint 

Especially over the last year, Washington’s strategy for securing mineral supply chains has become fundamentally coalitional. Rather than relying on domestic production, the United States is working to align a network of partner countries, including mineral producers, processors, and technology leaders, into coordinated supply chains.

The reason is that minerals are essential to an expanding set of critical technologies – and China has a “chokepoint” thanks to its dominance of supply chains. This is especially the case in rare earth refining, where China is responsible for 85 percent (purified light rare earths) to 100 percent (heavy rare earths) of global supplies. China’s dominance in rare earths has been wielded as a means of economic coercion, notably against Japan and the United States.

The most visible step in U.S. coalition-building came in February 2026, when Washington convened the Critical Minerals Ministerial, bringing together representatives from 55 “like minded” partners. The list included countries ranging from Australia, Canada, and Japan to Angola, Brazil, Mongolia, Saudi Arabia, and Zambia, as well as the European Commission and the United Kingdom. It included countries not necessarily rich in critical mineral reserves, let alone the significant rare earths that Vietnam possesses. 

The goal of the gathering was to coordinate policies that could reshape global mineral markets. Read: to reduce dependence on Chinese supply chains.

Several concrete initiatives were announced. Among them was Project Vault, an initiative to establish a domestic (U.S.) stockpile of critical minerals backed by the largest loan in the history of the Export-Import Bank of the United States. The stockpile is designed to provide a buffer against supply disruptions while encouraging investment in new mining and processing projects.

The ministerial also launched a new multilateral platform called the Forum on Resource Geostrategic Engagement (with the on-brand moniker FORGE). The initiative aims to coordinate policy among participating countries, aligning investment strategies, regulatory frameworks, and supply chain planning.

In addition, since the end of 2025 the United States has also signed 13 new bilateral frameworks and memoranda of understanding on critical minerals cooperation with partner countries. These agreements with countries ranging from Australia, to Canada, to the U.K., are intended to accelerate mining projects, expand refining capacity, and facilitate technology transfer among participating economies. In the White House’s announcement of the Australian agreement, the objective is explained as to “assist both countries in achieving resilience and security of critical minerals and rare earths supply chains, including mining, separation, and processing.”

Discussions at the ministerial also explored (even) more ambitious ideas, including price floors for certain minerals and the creation of a preferential trading bloc.

These initiatives contribute to a broader strategy called “Pax Silica.” The concept links semiconductor supply chains, artificial intelligence infrastructure, and the minerals that underpin them into a single strategic ecosystem.

While certainly ramped up by the Trump administration, these critical mineral collaborations are not new. The Biden administration fostered alliance-building efforts through initiatives such as the Minerals Security Partnership, launched in 2022 to coordinate investment in new mining and processing projects across allied economies.

For policymakers in Washington, Brussels, Tokyo, and Canberra, collaborative agreements represent essential means for reducing their economic vulnerability at the hands of China. And not only economic vulnerability, also national security vulnerability, since access to critical minerals is essential for cutting-edge defense technology.

But not all U.S. partners are signing up. Vietnam, a rare earth-rich middle power, is taking a less aligned path. 

Vietnam’s Strategy: Niche Superpower Ambitions and Bamboo Diplomacy

Though the country possesses one of the world’s largest rare-earth reserves, Vietnam was not among the governments participating in the U.S.-convened Critical Minerals Ministerial. This absence raises an intriguing question: was Vietnam not invited, or did it choose not to participate?

Either possibility points to the same underlying issue. Hanoi appears to be pursuing a different, more autonomous strategy for its mineral resources.

Rather than focusing primarily on integrating into Western supply chain alliances, Vietnam has increasingly emphasized its desire to achieve domestic industrial upgrading and, as a result, strategic autonomy. A key example is its December 2025 decision to entrench the export ban of unprocessed rare earths, while encouraging investment in refining and downstream manufacturing inside the country.

The policy is part of its broader economic statecraft strategy. Vietnam’s rare earth export restrictions illustrate how some middle powers are using sanctions (e.g, export bans) and industrial policy tools (e.g., investment in domestic production capabilities) to ensure autonomy and bolster economic development. In Vietnam’s own case, the country is also increasingly placing rare earth in a security light. A recent discussion in its law-making National Assembly suggested rare earth mining in certain areas be vetted by the Ministry of National Defense and Ministry of Public Security. Mining has historically been under the sole remit of the Ministry of Agriculture and Environment. Vietnam’s approach also reflects a growing desire of middle powers to cultivate their “niche superpowers.” Rather than dominating entire industries, some countries achieve global influence by specializing in highly specific segments of strategic supply chains. Taiwan’s dominance in advanced semiconductor manufacturing, referred to as a “silicon shield,” is the most famous example. Finland’s leadership in icebreaker shipbuilding is another.

Hanoi is investing in the hopes that rare earth refining could become Vietnam’s equivalent niche. Rare earth refining would be essential on its own, and also linked to upgrading in value-added activities like semiconductors. See, for example, recent industrial linkages referenced in talks with the EU. 

Notably, Vietnam appears willing to deepen industrial cooperation with partners like the U.S. and the EU while still maintaining control over its mineral resources. Vietnam has a Comprehensive Strategic Partnership with the United States, which was signed in 2023, but is not neatly aligning in recent critical minerals partnerships. 

This strategy reflects Vietnam’s long-standing diplomatic approach, often described as “bamboo diplomacy.” Like bamboo, Vietnam’s foreign policy is designed to be flexible and resilient, bending with geopolitical winds without breaking.

This way, the country maintains productive economic ties with China (and Russia) while simultaneously strengthening partnerships with the United States, Japan, and Europe. Vietnam remains open to foreign investment in exploration, mining, and refining projects, as it has welcomed from Japan since 2010, but on terms that support its domestic industrial upgrading.

But, by focusing on its own rare earth capabilities rather than the U.S.-led coalitions, Vietnam aims to enhance its economic leverage without formally aligning with any geopolitical bloc.

A Fragmenting Minerals Order?

The contrast between Washington’s alliance-building and Hanoi’s more autonomous strategy prompts questions about broader shifts in the political economy of resources. Advanced industrial economies, like the EU, Japan, and the United States, are focused on securing reliable supplies of critical minerals for precision manufacturing, green energy technologies, and defense technology. Their approach emphasizes cooperation, through initiatives like the Critical Minerals Ministerial, FORGE, and Pax Silica, to diversify supply chains and reduce dependence on China. They are casting wide, non-China, nets, with key geostrategic allies.

Resource-rich emerging economies, like Vietnam, may have different priorities. For them, critical minerals represent an opportunity to drive industrial upgrading and technological capability. Export restrictions, local processing requirements, involvement of security bodies, and carefully structured partnerships are used to ensure that mineral wealth translates into domestic industrial strength and national autonomy rather than simply raw-material exports to please allies.

As demand surges, these competing priorities are likely to reshape the global minerals landscape. Instead of a single coordinated system, multiple overlapping supply networks may emerge: some countries aligning with U.S.-led initiatives, others with deep ties to China, and still others, like Vietnam, pursuing more independent strategies.

Vietnam’s rare earth policy offers a glimpse of this emerging politics of critical minerals. By restricting raw exports while encouraging domestic refining and manufacturing, Hanoi is seeking to turn natural resources into strategic leverage. It will work with various countries to build up what it hopes will be a niche superpower status in rare-earths and the technologies of the energy transition. As of now, it is in the early stages.

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At a symposium on economic security at Oxford’s Nissan Institute on March 5, covering topics from international cooperation and competition in exports, the private sector, and technology, one phrase echoed across nearly every panel discussion: critical minerals. 

Minerals like cobalt, lithium, nickel, and rare earth elements, once little more than obscure entries in geology textbooks, are now central to geopolitics. These resources power electric vehicles, wind turbines, semiconductors, and advanced weapons systems – all the technologies that define economic security and military power in the 21st century. The offensive or defensive moves that states now take to bolster their “supply chain resilience” are underpinned by their access to critical minerals. 

That shift is forcing governments to rethink the politics of resources. For decades, resource geopolitics revolved around oil and gas. Oil price rises (as we are seeing at the time of writing) can wreak havoc on inflation, but geostrategic contests increasingly concern the minerals that enable the whole economy.

In response, the United States is attempting to build alliances among “like-minded” countries to diversify supply chains and reduce dependence on China. 

Vietnam, by contrast, appears to be pursuing a more independent strategy. In December 2025 the government further entrenched its restrictions on the export of unprocessed rare earths in an effort to build domestic refining capabilities and preserve strategic autonomy.

This different approach raises questions about why an emerging middle power would abstain from a U.S.-led alliance. How did the Vietnamese government come to this position and why is it – one of the countries with the greatest reserves of rare earths and a partner of the U.S. in other contexts – acting alone? What lessons does it offer to other resource-rich states who may increasingly see minerals as tools of industrial policy and economic statecraft?

The U.S. Alliance Strategy: Collaboration to Reduce China’s Critical Minerals Chokepoint 

Especially over the last year, Washington’s strategy for securing mineral supply chains has become fundamentally coalitional. Rather than relying on domestic production, the United States is working to align a network of partner countries, including mineral producers, processors, and technology leaders, into coordinated supply chains.

The reason is that minerals are essential to an expanding set of critical technologies – and China has a “chokepoint” thanks to its dominance of supply chains. This is especially the case in rare earth refining, where China is responsible for 85 percent (purified light rare earths) to 100 percent (heavy rare earths) of global supplies. China’s dominance in rare earths has been wielded as a means of economic coercion, notably against Japan and the United States.

The most visible step in U.S. coalition-building came in February 2026, when Washington convened the Critical Minerals Ministerial, bringing together representatives from 55 “like minded” partners. The list included countries ranging from Australia, Canada, and Japan to Angola, Brazil, Mongolia, Saudi Arabia, and Zambia, as well as the European Commission and the United Kingdom. It included countries not necessarily rich in critical mineral reserves, let alone the significant rare earths that Vietnam possesses. 

The goal of the gathering was to coordinate policies that could reshape global mineral markets. Read: to reduce dependence on Chinese supply chains.

Several concrete initiatives were announced. Among them was Project Vault, an initiative to establish a domestic (U.S.) stockpile of critical minerals backed by the largest loan in the history of the Export-Import Bank of the United States. The stockpile is designed to provide a buffer against supply disruptions while encouraging investment in new mining and processing projects.

The ministerial also launched a new multilateral platform called the Forum on Resource Geostrategic Engagement (with the on-brand moniker FORGE). The initiative aims to coordinate policy among participating countries, aligning investment strategies, regulatory frameworks, and supply chain planning.

In addition, since the end of 2025 the United States has also signed 13 new bilateral frameworks and memoranda of understanding on critical minerals cooperation with partner countries. These agreements with countries ranging from Australia, to Canada, to the U.K., are intended to accelerate mining projects, expand refining capacity, and facilitate technology transfer among participating economies. In the White House’s announcement of the Australian agreement, the objective is explained as to “assist both countries in achieving resilience and security of critical minerals and rare earths supply chains, including mining, separation, and processing.”

Discussions at the ministerial also explored (even) more ambitious ideas, including price floors for certain minerals and the creation of a preferential trading bloc.

These initiatives contribute to a broader strategy called “Pax Silica.” The concept links semiconductor supply chains, artificial intelligence infrastructure, and the minerals that underpin them into a single strategic ecosystem.

While certainly ramped up by the Trump administration, these critical mineral collaborations are not new. The Biden administration fostered alliance-building efforts through initiatives such as the Minerals Security Partnership, launched in 2022 to coordinate investment in new mining and processing projects across allied economies.

For policymakers in Washington, Brussels, Tokyo, and Canberra, collaborative agreements represent essential means for reducing their economic vulnerability at the hands of China. And not only economic vulnerability, also national security vulnerability, since access to critical minerals is essential for cutting-edge defense technology.

But not all U.S. partners are signing up. Vietnam, a rare earth-rich middle power, is taking a less aligned path. 

Vietnam’s Strategy: Niche Superpower Ambitions and Bamboo Diplomacy

Though the country possesses one of the world’s largest rare-earth reserves, Vietnam was not among the governments participating in the U.S.-convened Critical Minerals Ministerial. This absence raises an intriguing question: was Vietnam not invited, or did it choose not to participate?

Either possibility points to the same underlying issue. Hanoi appears to be pursuing a different, more autonomous strategy for its mineral resources.

Rather than focusing primarily on integrating into Western supply chain alliances, Vietnam has increasingly emphasized its desire to achieve domestic industrial upgrading and, as a result, strategic autonomy. A key example is its December 2025 decision to entrench the export ban of unprocessed rare earths, while encouraging investment in refining and downstream manufacturing inside the country.

The policy is part of its broader economic statecraft strategy. Vietnam’s rare earth export restrictions illustrate how some middle powers are using sanctions (e.g, export bans) and industrial policy tools (e.g., investment in domestic production capabilities) to ensure autonomy and bolster economic development. In Vietnam’s own case, the country is also increasingly placing rare earth in a security light. A recent discussion in its law-making National Assembly suggested rare earth mining in certain areas be vetted by the Ministry of National Defense and Ministry of Public Security. Mining has historically been under the sole remit of the Ministry of Agriculture and Environment. Vietnam’s approach also reflects a growing desire of middle powers to cultivate their “niche superpowers.” Rather than dominating entire industries, some countries achieve global influence by specializing in highly specific segments of strategic supply chains. Taiwan’s dominance in advanced semiconductor manufacturing, referred to as a “silicon shield,” is the most famous example. Finland’s leadership in icebreaker shipbuilding is another.

Hanoi is investing in the hopes that rare earth refining could become Vietnam’s equivalent niche. Rare earth refining would be essential on its own, and also linked to upgrading in value-added activities like semiconductors. See, for example, recent industrial linkages referenced in talks with the EU. 

Notably, Vietnam appears willing to deepen industrial cooperation with partners like the U.S. and the EU while still maintaining control over its mineral resources. Vietnam has a Comprehensive Strategic Partnership with the United States, which was signed in 2023, but is not neatly aligning in recent critical minerals partnerships. 

This strategy reflects Vietnam’s long-standing diplomatic approach, often described as “bamboo diplomacy.” Like bamboo, Vietnam’s foreign policy is designed to be flexible and resilient, bending with geopolitical winds without breaking.

This way, the country maintains productive economic ties with China (and Russia) while simultaneously strengthening partnerships with the United States, Japan, and Europe. Vietnam remains open to foreign investment in exploration, mining, and refining projects, as it has welcomed from Japan since 2010, but on terms that support its domestic industrial upgrading.

But, by focusing on its own rare earth capabilities rather than the U.S.-led coalitions, Vietnam aims to enhance its economic leverage without formally aligning with any geopolitical bloc.

A Fragmenting Minerals Order?

The contrast between Washington’s alliance-building and Hanoi’s more autonomous strategy prompts questions about broader shifts in the political economy of resources. Advanced industrial economies, like the EU, Japan, and the United States, are focused on securing reliable supplies of critical minerals for precision manufacturing, green energy technologies, and defense technology. Their approach emphasizes cooperation, through initiatives like the Critical Minerals Ministerial, FORGE, and Pax Silica, to diversify supply chains and reduce dependence on China. They are casting wide, non-China, nets, with key geostrategic allies.

Resource-rich emerging economies, like Vietnam, may have different priorities. For them, critical minerals represent an opportunity to drive industrial upgrading and technological capability. Export restrictions, local processing requirements, involvement of security bodies, and carefully structured partnerships are used to ensure that mineral wealth translates into domestic industrial strength and national autonomy rather than simply raw-material exports to please allies.

As demand surges, these competing priorities are likely to reshape the global minerals landscape. Instead of a single coordinated system, multiple overlapping supply networks may emerge: some countries aligning with U.S.-led initiatives, others with deep ties to China, and still others, like Vietnam, pursuing more independent strategies.

Vietnam’s rare earth policy offers a glimpse of this emerging politics of critical minerals. By restricting raw exports while encouraging domestic refining and manufacturing, Hanoi is seeking to turn natural resources into strategic leverage. It will work with various countries to build up what it hopes will be a niche superpower status in rare-earths and the technologies of the energy transition. As of now, it is in the early stages.

Robyn Klingler-Vidra is vice dean (global engagement) of King's Business School at King's College of London.

Adam Chalmers is senior lecturer of politics and international relations at the University of Edinburgh.

Berlin Tran is senior lecturer at the International School of Business, University of Economics Ho Chi Minh.

Robert Wade is professor of political economy and development at London School of Economics and Political Science.

China critical minerals

U.S. critical minerals

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