The Lao government is exploring the possibility of launching a pilot rare earth token project to generate more foreign currency and bolster the country’s economy, Prime Minister Sonexay Siphandone discussed at the monthly cabinet meeting in Vientiane Capital on 23- 24 November.
A rare earth token pilot project is an initiative to explore the feasibility and potential benefits of using blockchain technology to facilitate the trading and management of rare earth elements (REEs), a group of 17 metals with unique properties that make them essential for a wide range of high-tech applications, including smartphones, wind turbines, MRIs, hard disk drives, LEDs, and electric motors.
By spearheading this project, the government aims to achieve a rapid surge in foreign exchange reserves and foster economic growth by attracting increased foreign investments.
However, economists are urging a meticulous evaluation of the scheme’s feasibility before implementation, considering potential risks such as volatile rare earth prices, uncertain profitability, environmental impact from mining and processing, and high vulnerability to cyberattacks.
To ensure best practices, the government is also discussing the formation of a committee and the development of essential legislation to supervise this pilot project. This decision, if implemented, aims to ensure effective oversight and regulation of the scheme’s proceedings.
In another cabinet meeting in September, PM Sonexay also directed relevant authorities to accelerate the formulation of a strategy concerning rare earths, critical metals, and other minerals, aiming to ensure more effective management of mining activities in Laos.
With the surging global demand for rare earths, the government emphasizes the importance of Laos maximizing its economic gains from the extraction of these invaluable resources.