China’s Shadow Over Myanmar’s Rare Earth Rush: Rebels, Mines, and a Dying Mekong

Myanmar’s Rare Earth Mining Surge Poisons the Mekong
Rebel Forces Seize Key Extraction Sites
China Seen as the Real Power Behind the Militias

The environment along the Mekong River, which runs through Southeast Asia, is worsening by the day. In Myanmar’s eastern Shan State and other regions now under rebel control, rare earth mining has surged under China’s direction, causing rapid water contamination. Beijing has been pressuring the Kachin Independence Army (KIA), which is engaged in fighting around rare earth production sites, while actively deploying the China-aligned United Wa State Army (UWSA) to expand its economic grip inside Myanmar.

The Toxic Fallout of Rare Earth Mining

On August 19, Al Jazeera reported that the sharp increase in rare earth mining in Myanmar’s Shan State is releasing toxic byproducts into rivers, contaminating water that flows as far as Thailand and Laos. The Shan Human Rights Foundation warned that pollution has not only worsened the health of nearby villagers but also devastated local ecosystems and agriculture.

Rare earths are extracted by drilling into mountains and dousing the soil with sulfuric and hydrochloric acid—an inherently destructive process. In April, the Kok River in Chiang Rai Province, northern Thailand, which connects to the Mekong, turned orange from waste runoff originating in Shan State. Tests by Thailand’s Pollution Control Department found arsenic and lead levels 2 to 15 times above World Health Organization safety standards, prompting warnings against using the river for drinking water.

China’s growing demand for raw materials is widely seen as the driver of this boom. Myanmar, one of the world’s top three rare earth producers, accounted for about 8% of global output last year, according to the U.S. Geological Survey. Nearly all of its ore is exported to China for processing, as Beijing maintains a near monopoly over the refining and global supply chain of rare earth materials.

Rebel Forces Seize Shan and Kachin Mining Hubs

A striking feature of Myanmar’s rare earth supply chain is that much of it is now under the control of armed rebel groups. In June, reports revealed that the United Wa State Army (UWSA)—one of the most powerful militias in the country—had occupied rare earth mines in eastern Shan State and begun direct extraction. More than 100 workers rotate shifts at these sites, with the mined materials transported roughly 200 kilometers to the Chinese border. The UWSA, long backed by China both militarily and economically, is also known to control one of the world’s largest tin mines.

Meanwhile, the Kachin Independence Army (KIA), an ethnic minority force, seized the towns of Chipwi and Panwa in northern Kachin State last October. Kachin, along with Shan, is one of Myanmar’s two key rare earth production regions, supplying raw materials for China’s magnet industry. According to Myanmar think tank ISP-Myanmar, the number of mining sites in northern Kachin nearly tripled in just four years, from around 130 in 2020 to over 370 in 2024.

The KIA has also been locked in fierce battles with Myanmar’s military since December over control of Bhamo, a strategic city less than 100 kilometers from the Chinese border. Bhamo is not only part of a major rare earth mining zone but also serves as a critical logistics hub for the junta, home to a population of roughly 166,000.

China as the Real Power Behind Myanmar’s Rare Earth Supply Chain

Analysts note that Myanmar’s rebel groups do not fully control the rare earth trade. The country’s key export destination, China, has been pulling strings behind the scenes to maximize its own economic gains. In May, according to Reuters, Beijing warned the Kachin Independence Army (KIA) that it would halt imports unless the group withdrew from Bhamo. The ongoing clashes in the city had disrupted mining operations, prompting China to directly pressure the rebels to stand down.

Beijing has also leaned heavily on its ally, the United Wa State Army (UWSA). Reuters reported in June that Chinese firms were developing new rare earth mines in Shan State’s mountain regions. Signs in Chinese and the presence of Chinese managers at the sites suggested direct involvement. Satellite imagery further showed that large-scale leaching ponds—structures designed for chemical extraction—had been built there as early as 2023, indicating years of coordinated production under Chinese direction.

The mines are now guarded by UWSA forces, estimated at 30,000 to 35,000 fighters equipped with modern Chinese weaponry. The militia strictly controls access with permits and has tightened security around the facilities. When KIA seizures in Kachin disrupted the flow of supply, Beijing mobilized the UWSA to ramp up mining in Shan, ensuring that China’s demand for rare earths remained uninterrupted.