The United States is throwing its weight behind the Ampasindava rare earth project in Madagascar, a move designed to loosen China’s stranglehold on critical mineral supply chains. The State Department said the investment aims to challenge supply networks long controlled by rivals.
London-listed Harena Rare Earths, which owns the project, disclosed last week that the U.S. International Development Finance Corporation (DFC) has committed up to $4.48 million for pilot plant work, laboratory testing and environmental programmes. The funding opens the door to larger-scale financing.
In an emailed statement to Reuters, a State Department spokesperson said Washington’s Africa strategy centres on increasing U.S. investment in the mining sector. “Madagascar fits squarely within that strategy, and we see opportunities to expand U.S. and allied investment in the country,” the spokesperson added.
Ampasindava is an ionic clay deposit rich in neodymium, praseodymium, dysprosium and terbium — critical elements for permanent magnets used in fighter jets, precision-guided munitions, electric vehicles and wind turbines. Harena expects to produce roughly 4,000 metric tons of rare earth oxides annually, including about 1,700 tons of high-value magnet rare earths NdPr and DyTb.
China has long dominated global rare earth mining and processing, and has tightened its grip through export controls in recent years. The Ampasindava development highlights a shifting dynamic in Africa’s critical minerals sector: where Chinese companies once led investments in copper, cobalt and lithium, some rare earth projects are now drawing backing from the U.S. and its Western allies.
Harena Executive Chair Andrew Murphy told Reuters that an exploitation permit could be secured within weeks, with production targeted for mid-2028. The overall development cost is estimated at around $150 million. While the DFC’s initial commitment is modest, Murphy believes it will pave the way for larger U.S. support. The DFC confirmed that additional financing may be considered, subject to due diligence and necessary approvals.
On the processing side, Harena is evaluating options in the United States and Europe, naming MP Materials, USA Rare Earths and Solvay as potential refining partners.
