Malaysian PM Announces Construction Of A Magnet Factory Worth IDR 2.2 Trillion To Encourage Rare Earth Metal Sector

Malaysian Prime Minister, Anwar Ibrahim (photo: x @bernamadotcom)

JAKARTA - Prime Minister of Malaysia, Anwar Ibrahim, announced the construction of a super-magnet production facility worth 600 million ringgit (around Rp2.3 trillion) in Pahang state. This strategic project is expected to be the main driver of strengthening the Malaysian rare earth metal sector, as reported by the state news agency, Bernama.

According to Anwar, the project will strengthen Malaysia's position in the advanced material industry and clean technology, as well as support the country's efforts to build critical mineral supply chains that have been dependent on imports. JS Link has purchased land and is ready to start operations. This is no longer just a memorandum of understanding. Investment has entered, the land is ready, now we focus on accelerating the process," Anwar said as quoted by Bernama on Saturday, November 1.

The super magnet factory will be developed by Australian company Lynas Rare Earths Ltd along with its South Korean counterpart, JS Link Co Ltd, which signed a cooperation agreement in July 2025. This new facility will have a production capacity of up to 3,000 tons of neodymium magnets per year, and will be located near Lynas' advanced material plant in Kuantan district, Pahang.

Anwar emphasized that this project will be under the direct supervision of the Malaysian Ministry of International Trade and Industry, given the strategic and sensitive involvement of the rare earth metal processing sector. "This project will not only create new jobs, but also strengthen Malaysia's capabilities in the high technology sector and clean energy," he said.

This step is part of the Malaysian government's great strategy to develop national rare earth metal potential. Based on government data, Malaysia has rare earth metal reserves reaching 16.1 million metric tons. However, until now the country still lacks technology and infrastructure to mine and process these resources efficiently.

Malaysia is intensively establishing international partnerships to attract foreign investment and technology transfer. In addition to cooperating with Australia and South Korea, the government is also reportedly negotiating with China regarding rare earth metal processing. Last month, Malaysia also signed a deal with the United States to expand cooperation in diversifying critical mineral supply chains.

Rare earth metals such as neodymium are important components in various high-tech industries, including electric vehicles (EVs), semiconductors, wind turbines, to sophisticated weapons systems. Global demand for this material continues to increase as the energy transition and revolution of green industries in various countries increases.

With this super magnetic project worth more than IDR 2.3 trillion, Malaysia hopes to strengthen its role in the global supply chain of rare earth metals, while reducing dependence on other countries in the supply of strategic materials.