Afghanistan, China’s eyes on rare earths: a trillion dollar treasure

A trillion-dollar hidden treasure that China has its eye on. They are the rare earths of Afghanistan, a group of 17 chemical elements including scandium, gadolinium or lanthanum, whose properties make them necessary to make high-tech products. Not only are they found in consumer goods such as smartphones and televisions, but they are also fundamental for the ‘green economy’ as they are essential for making photovoltaic panels and electric cars. The Diplomat magazine estimates that Afghanistan has mineral resources worth between one and three trillion dollars. The attention of analysts has focused these days on the possible consequences of the collapse of the Ghani government on world stock exchanges, although so far the Taliban’s seizure of power in Afghanistan has only partially shaken international lists. Much stronger was the blow dealt to Mvis Global Rare Earth-Strategic Metals, an index that includes companies engaged in activities related to the production and refining of rare earths and strategic minerals, which since last Friday lost 9% , while since the beginning of the year it has risen by 60%. An evident sign that the rare earth sector is the first sector that pays the repercussions of the return to Kabul of the Koranic students. In an interview with CNBC, Shamaila Khan, head of emerging markets debt at AllianceBernstein, expressed concern that China could use its relations with the Taliban to get its hands on this treasure and called for an intervention by the international community with pressure about Beijing. “There should be an international initiative to ensure that if a country agreed to exploit minerals (from Afghanistan, ed) on behalf of the Taliban, it could only do so by respecting strict conditions in which human and women’s rights are preserved”, said the analyst. Meanwhile Beijing has already taken the first steps to make agreements with the new masters of Kabul, preparing the ground with ‘soft’ statements in view of possible economic agreements. “The leaders of the Taliban have sent positive signals to the world saying that they will address the problems of the population and respond to their wishes,” the Chinese Foreign Ministry recently said. For the Asian giant, promises about an “inclusive” government and a halt to opium production are also “signals in the right direction”.