A file photo showing people taking part in a protest calling on the government to suspend a rare earths processing plant in the country operated by Australia's Lynas Corp in Kuala Lumpur, Malaysia — Reuters KUALA LUMPUR, Sept 04 (Reuters): Malaysia's government said on Wednesday its decision last month to extend a license for Australia's Lynas Corp for processing rare earth minerals aimed to show investors that the Southeast Asian nation was open for business and preserve 600 jobs.
Prime Minister Mahathir Mohamad's party had promised to halt the firm's operations when campaigning in the May 2018 election, after concerns were raised by politicians and activists about the production of radioactive waste from the process.
Lynas, the largest rare earths producer outside China that sells most of its products to China, says the low-level radioactive waste is not hazardous.
The government said last month it was extending the firm's license, a move that sparked protests from activists and politicians even though it set tougher terms and offered a six-month extension that was shorter than usual.
Outlining reasons for the government's decision, the prime minister's office said closing the operation would lead to more than 600 local employees losing their jobs and it would have a "negative impact on Malaysia's credibility as a business-friendly country".
The prime minister's office also said in the statement that failing to extend the license would mean Malaysia would be "unable to break the Chinese monopoly as the sole exporter of rare earths".
China has a tight grip on the rare earths market, as the world's biggest producer of the minerals that are used in smartphones and other consumer electronics, and also used in the defence industry and other sectors.
The US Department of Defence has been in talks with Australia to host a facility that would process rare earth minerals in an effort to reduce reliance on China for the specialized materials.
Activists in Malaysia have urged the government to review the decision to extend the license for Lynas.
"We hope they can re-examine their mistakes and start to serve the interests of the people," Tan Bun Teet, chairman of non-government group 'Save Malaysia Stop Lynas', told Reuters.
A Xinhua report adds: Malaysia's exports rose 1.7 per cent year-on-year to 87.96 billion ringgit (about 20.88 billion US dollars) in July, contributed mainly by higher exports to its trading partners including the United States, China and Singapore, official data showed Wednesday.
Malaysia International Trade and Industry Ministry said in a statement that Malaysia's exports to China expanded by 3.8 per cent year-on-year to 13.34 billion ringgit (about 3.17 billion US dollars) in July on higher exports of manufactures of metal, petroleum products and Liquefied Natural Gas (LNG).
Trade with China which represented 17.6 per cent of Malaysia's total trade, also rose 0.2 per cent to 28.5 billion ringgit (about 6.77 billion US dollars) in the month.
Total trade for the month fell 1.9 per cent year-on-year to 161.65 billion ringgit with imports contracted 5.9 per cent to 73.69 billion ringgit (about 17.5 billion US dollars). This led the trade surplus surging 75.6 per cent to 14.27 billion ringgit (about 3.39 billion US dollars).
For the first seven months, total trade declined by 1.4 per cent year-on-year to 1.057 trillion ringgit (about 0.25 trillion US dollars). Exports and imports slipped by 0.4 per cent and 2.6 per cent to 569.46 billion ringgit (about 135 billion US dollars) and 487.84 billion ringgit (about 116 billion US dollars) respectively.
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