More than four years after the 2021 coup, Myanmar’s internal power dynamics have significantly transformed. The military’s authority has weakened, while ethnic armed organizations (EAOs/EROs) have expanded both their territorial control and political influence. One of the most strategic shifts is that many of Myanmar’s critical minerals—vital to China’s strategic industries—are now largely under EAO/ERO control.
This shift raises a fundamental question: Can the EAOs/EROs leverage their control over these resources to alter the terms of their engagement with China?
Strategic importance
Critical minerals such as rare earth elements, tin, antimony and tungsten are essential for China’s technological, military and energy sectors. Myanmar is a key supplier, especially of heavy rare earth elements (HREEs) like dysprosium and terbium—core inputs for advanced military systems, electric vehicles and renewable energy.
Since the coup, exports of these minerals to China have surged. Rare earth exports have increased fivefold, while jade exports have grown 20-fold. Tin and tungsten from northern Shan State have filled crucial gaps in China’s supply chain. Nearly half of China’s annual rare earth imports—mostly HREEs—come from Myanmar. As trade tensions with the West increase, China has responded by imposing export restrictions on key elements like dysprosium and terbium, underscoring both their value and Myanmar’s pivotal role in global supply chains.
The Myanmar National Democratic Alliance Army (MNDAA) is positioning itself as a key player in the critical minerals sector. Antimony remains a core resource, while the group actively seeks Chinese investment in copper and other strategic minerals. Its China-centered economic policy underpins broader ambitions: establishing proto-state institutions, asserting de facto sovereignty and legitimizing Kokang’s regional authority.

China’s dealings with EAOs
Publicly, China is often portrayed as a coercive actor that exerts pressure to secure its interests. But behind closed doors, its approach has become more nuanced, especially toward EAOs that control key mineral deposits.
One such example is the Kachin Independence Army (KIA), which since November 2024 has seized control of nearly all rare earth mining areas in Pangwa, Chipwi and Momauk. These regions are home to some of the world’s richest deposits of HREEs, including dysprosium and terbium.
China has quietly adopted a softer, more deferential tone toward the Kachin Independence Army (KIA) and its political wing, the Kachin Independence Organization (KIO). Chinese delegates have shown unusual respect—waiting for KIO/KIA representatives, adjusting meeting schedules and reopening border gates in KIA-controlled areas. This marks a notable shift, reflecting China’s recognition of the strategic importance of stable access to critical minerals.
In March, the KIA reportedly announced the resumption of rare earth exports to China, imposing a tax of 35,000 yuan (about US$4,860) per ton. “This is a prime example that China does not dare to exert strong pressure anymore,” a representative who acknowledged China’s shifting attitude toward the KIA/KIO told The Irrawaddy.
On the other hand, the KIA’s expanding mining operations have sparked backlash from local communities. Residents in areas like Momauk and Chipwi oppose the environmental degradation caused by rare earth extraction. They cite pollution, land damage and the lack of consent or consultation. While the KIA gains strategic leverage, it also risks social unrest and declining legitimacy among affected populations—raising concerns about governance, cohesion and long-term sustainability.

The limits of leverage
On the surface, EAOs controlling critical mineral zones appear to possess powerful leverage. As gatekeepers to resources essential for China’s technological, defense and energy ambitions, EAOs could, in theory, exchange their control for political concessions, international recognition or tangible progress toward federalism or autonomy.
However, leverage does not automatically translate into political power. Despite Beijing’s evolving tone toward groups such as the KIA/KIO, its actions at the negotiation table rarely reflect support for inclusive peace or substantive political transformation.
China pursues a dual strategy: secure uninterrupted access to minerals while avoiding formal recognition of any actor—military or opposition—that challenges the principle of state sovereignty. Its priorities remain stability, border security and protection of strategic investments.
China’s engagement is multi-layered. Central authorities steer diplomatic posture, Yunnan officials handle trade and cross-border management, and Chinese state-owned and private firms negotiate informal deals on the ground. These firms acquire concessions through local brokers who manage permits, taxes and protection payments. This fragmented and opaque system benefits China while maintaining strategic ambiguity—extracting value without empowering any particular faction.
Double-edged sword
While resource control strengthens EAOs/EROs, most profits are funneled back into war. Groups actively fighting, like the KIA or those in Kachin and Sagaing, often spend mineral revenue on arms, logistics and military operations. A single offensive can cost hundreds of thousands of dollars. In the absence of state institutions or budgetary systems, natural resource extraction remains the financial backbone of Myanmar’s armed resistance.
Meanwhile, for decades, resource-rich ethnic areas have suffered poverty, displacement and environmental harm. Communities near mining zones often see little benefit. Instead, resources fund conflict, neglect social infrastructure and perpetuate local marginalization. This entrenched extractive logic must change.

EAOs at a crossroads
For EAO/EROs, resource wealth is both empowering and limiting. Control over minerals enables governance, taxation and military sustenance. Yet overreliance on China risks turning these groups into subcontractors for Beijing’s strategic interests—undermining long-term political autonomy.
To break this cycle of dependency and extractive politics, EAOs/EROs must move beyond transactional deals and adopt a principled, long-term strategy. This includes strengthening internal governance of mineral resources, enforcing environmental and labor protections and negotiating more transparent and equitable terms with Chinese companies. Resource control must not be treated as an end in itself—but rather as a platform for pursuing broader political legitimacy, both domestically and internationally.
Economic leverage alone is not enough. EAOs/EROs must also invest in pathways to positive peace. This means engaging in inclusive political dialogue aimed at a comprehensive settlement grounded in federalism, equality and sustainable stability. Only by embedding resource governance within a larger vision of political transformation can EAOs/EROs avoid becoming permanent subcontractors in China’s strategic orbit.
Navigating this tightrope is essential—not just for the EAOs/EROs’ political survival, but for Myanmar’s future. Critical minerals are no longer just commodities; they are strategic assets for China, bargaining chips for EAOs/EROs and instruments of geopolitical influence. Yet this leverage is a double-edged sword. While it offers short-term autonomy and power, it also deepens vulnerabilities to Chinese manipulation, economic dependency and crises of legitimacy.
EAOs/EROs now face a pivotal choice: continue acting as resource gatekeepers in service of external interests, or leverage their control to push for political legitimacy and lasting peace. Escaping the dependency trap requires linking mineral governance to accountability, fairness and a clear political vision.
Establishing transparent regulatory frameworks, enforcing labor and environmental standards and demonstrating responsible resource stewardship can enhance EAOs/EROs’ credibility—not only with local communities but also with international stakeholders seeking ethical supply chains. In turn, this could open doors to greater recognition, aid and inclusion in political negotiations.
Without such a shift, resource wealth risks becoming a cage—profitable, but confining.
In the end, true power lies not in what they extract—but in what they build.
Athena Awn Naw specializes in analyzing ethnic conflict dynamics in Myanmar, focusing on China’s expanding influence across economic sectors. Her expertise includes the socioeconomic impacts of China’s involvement, its role in Myanmar’s armed conflicts and peace processes, and its participation in regional initiatives.