In a significant development in the struggle for control over heavy rare-earth elements, Vietnamese entrepreneur Luu Anh Tuan has sought U.S. support to disrupt China’s dominance in this critical sector. Tuan, who fled Vietnam to escape increasing Chinese influence, has made strides to transfer his proprietary heavy rare earth separation technology from his company, Vietnam Rare Earth (VTRE), to VTRU Corporation, a Nevada-registered entity. This technology transfer agreement comes at a time when global demand for rare earths—crucial in the production of smartphones, missile guidance systems, and various other technologies—remains heavily reliant on Chinese companies, which control a staggering 90% of rare earth separation and refining capacities.
Despite the presence of U.S. firms like MP Materials and Australian companies like Lynas working to establish their own separation technologies, China’s tightening grip continues to pose a significant challenge. Tuan’s efforts, along with several memoranda of understanding with Western companies, aim to shift the balance of power. However, in October 2023, as Tuan was actively pursuing these initiatives, Vietnamese authorities conducted a raid on VTRE’s Hanoi office, resulting in the seizure of equipment and the arrest of multiple employees. This crackdown coincided with President Biden’s visit to Vietnam, wherein agreements regarding rare earth minerals were established, making the timing of the events particularly suspect.
In December, amidst rising tensions, China enforced a ban on rare earth extraction and separation, raising alarms within the global minerals community. This move underscored how countries like the U.S. and Australia had become acutely aware of their lack of technical expertise in this field, primarily due to China’s market dominance established over two decades through state subsidies and environmental leniency. Tuan’s situation worsened as he faced charges related to allegations of tax fraud involving transactions with a local mining company, a situation exacerbated by alleged coercion from both his business partners and Vietnamese authorities.
Ultimately, Tuan pleaded guilty to various charges and received a 16-year prison sentence, with some advocates arguing that he was coerced into this plea, claiming manipulation by state actors favoring China’s interests. His case highlights broader issues of legal and human rights concerns within Vietnam, where reports of arbitrary arrests and torture in custody have surfaced. Tuan’s advocacy group indicates that his wrongful conviction stems from his efforts to operate a legitimate business in a landscape rife with corruption and governmental influence.
While Tuan’s scientific contributions to rare earth processing were recognized, including his company’s unique capacity for producing high-purity heavy rare earth oxides, his imprisonment raises urgent questions about the future of the rare earth industry in the region. The Vietnamese government’s aggressive stance against Tuan is viewed by some as a method to maintain control over the country’s mineral resources, particularly as Vietnam prepares to auction new mining opportunities. Support from U.S. officials was seemingly unfulfilled in Tuan’s attempts to relocate his operations, leaving him isolated with limited access to legal counsel or family.
Finally, the ongoing challenges faced by Tuan reflect broader geopolitical tensions surrounding access to critical minerals which are essential for defense and technology industries. With increasing restrictions and surveillance being imposed on Vietnamese experts in the mineral field, China is strengthening its hold over global supply chains. Despite assurances of support for businesses like Tuan’s, the realities on the ground showcase the iron grip of authoritarian governance, making it imperative for both regional and U.S. entities to reassess their strategies in mineral resource management and human rights advocacy within Vietnam.
