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4 September 2017

Help Afghans Exploit Their Mineral Riches


By Michael Silver

I met with President Trump recently to discuss American development of Afghanistan’s mineral deposits. Afghanistan owns one of the world’s richest untapped deposits of rare-earth and critical metals. The Afghans cannot develop these vast deposits on their own, but if they get U.S. help to do the job right, they will have an opportunity to move from a war-torn nation to a self-sustaining economy.

These materials are essential to green technology. A misconception in the environmental movement is that green technology eliminates mining. In fact it simply changes what you mine. You can’t build an electric car without neodymium and lanthanum, or produce solar or wind energy without indium and gallium.

No doubt the entire supply chain, from rare-earth ore to a solar panel, has less environmental impact than mining and burning coal, but bottom line it’s still mining. And building a multitrillion-dollar infrastructure of wind and solar farms and millions of electric vehicles is going to involve a lot of mining. The Afghans are fortunate that plate tectonics pushed much of the good stuff their way, and they are now well-positioned to take advantage.

I proposed this idea to the White House along with a package of suggestions to fill a gaping hole in the plan to rebuild America’s manufacturing base. At its most basic, manufacturing has two key operating costs: labor and materials. While the U.S. does a lot of hand-wringing over labor costs, the Chinese are quietly on their way to controlling every important deposit of rare-earth and critical metals on the planet. The only operating rare-earth mine outside China is in California—and three months ago, it was bought by a consortium that granted its Chinese shareholder the exclusive license to sell the ore.

The Chinese aren’t evil, merely smart. The U.S. has taken its eyes off the ball, and Afghanistan provides an opportunity to regain the right focus. One obstacle is a media narrative of rapacious Americans stealing the riches of a defenseless nation, while destroying its environment. One recent article opined: “This isn’t to say that Afghanistan cannot profit from its resource wealth—it can and should—but that the United States is not the right country to lead that charge.”

Have we forgotten our long history of leading the charge, starting with the Marshall Plan? If America is serious about bringing manufacturing back, it needs to get in the minerals game—and to do so in a way that benefits the Afghans and other sovereign owners of these deposits. It’s what the Chinese are doing all over the world—building roads, rail lines and power plants in exchange for ground leases.

The U.S. can do it too. It has in the past. I was personally involved in assisting the Chinese government when it began exporting rare-earth metals in the 1990s under Deng Xiaoping’s policy of global engagement. Postwar Afghanistan is the perfect test case for Americans to prove that we are as generous to other nations and as thoughtful in advancing our own interests as the earlier Americans who wrote and implemented the Marshall Plan.

Mr. Silver is chairman and CEO of American Elements.

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