HomeEconomic IndicatorVietnam detains officials in rare earth sector, raising doubts about China competition...

Vietnam detains officials in rare earth sector, raising doubts about China competition plans.

Rare Earth Mining Violations Lead to Arrests in Vietnam

Police in Vietnam have arrested six individuals, including the chairman of a company at the forefront of the country’s rare earth industry, for violating mining regulations. Vietnam’s government plans to auction new mining concessions for rare earths later this year, and officials from Vietnam Rare Earth JSC (VTRE) were among those arrested.

VTRE’s chairman, Luu Anh Tuan, has been accused of forging value-added tax receipts in rare earth trading with Thai Duong Group. Calls to Tuan went unanswered, and VTRE’s office in Hanoi has been closed for several days.

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VTRE has partnered with Australian mining companies Australian Strategic Materials (ASM) and Blackstone Minerals Ltd, although these companies were not named in the Vietnamese authorities’ investigation. Blackstone had previously announced a partnership with VTRE to win concessions at Vietnam’s largest mine, Dong Pao in Lai Chau province.

ASM also signed an agreement with VTRE for the purchase of 100 tons of processed rare earths this year, with the intention of negotiating a longer-term supply deal. The impact of the chairman’s arrest on these agreements remains uncertain.

Vietnam, with the second-largest deposits of rare earth minerals after China, aims to boost its rare earth industry and increase annual output to 60,000 tons of rare earth oxides by the end of the decade. However, the government has been cracking down on illegal mining and unauthorized exports of raw ores.

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The chairman of Thai Duong Group, Doan Van Huan, was also arrested for allegedly making illegal sales of ore extracted from the mine his company operated in Yen Bai province. The authorities seized 13,715 tons of rare earth ores during a raid on Thai Duong’s premises.

According to Vietnamese rules, the export of raw ores is largely restricted to encourage domestic refining capacity. The government aims to develop a self-sufficient rare earth industry and reduce dependence on China.

The arrests in Vietnam’s rare earth mining sector highlight the challenges in establishing a competitive industry and ensuring compliance with regulations. As the country seeks to expand its rare earth output, it must address issues related to illegal mining and maintain transparency in the sector.

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