Thailand and the United States signed a memorandum of understanding (MOU) titled “Cooperation to Diversify Global Critical Minerals Supply Chains and Promote Investments” on October 26, 2025, signaling a new strategic alignment aimed at developing Thailand’s mineral sector, particularly in rare earth elements (REEs). The MOU has implications for investments in technology, manufacturing, and other related sectors.

This update outlines the key provisions of the MOU and the potential opportunities and legal navigating points for businesses.

Objectives

The primary driver of this agreement is the US initiative to diversify global supply chains for critical minerals and reduce reliance on current market leaders, particularly China. For Thailand, it represents a major opportunity to attract high-tech investment and develop its downstream processing industries.

The cooperation is set to focus on five main areas:

1. Technical knowledge: Exchange of technical expertise and international best practices to strengthen Thailand’s mining and processing sector.
2. Joint cooperation: Establishing workshops, seminars, and scientific collaboration to boost innovation.
3. Regulatory practice: Promoting good governance and streamlining regulatory and licensing procedures.
4. Information sharing: Sharing data on potential projects and global market prices.
5. Full-value chain: The MOU covers the entire mineral lifecycle, from exploration and extraction to processing, refining, and recycling.

“First Opportunity to Invest” Clause

The most debated provision within the MOU states that “participants expect to have the first opportunity to invest . . . in critical minerals assets that may be sold in Thailand.”

• Business implications: This clause is widely interpreted as granting US companies a first look or preferential access to investment opportunities in Thailand’s critical minerals sector. This could be a significant advantage for US-based or affiliated companies in mining, technology, and energy seeking to secure a foothold in a developing REE supply chain.
• Thai government position: Thai officials, including the prime minister, have publicly clarified that the MOU is not legally binding and is not a treaty under the Thai constitution. They have emphasized that any potential US investor must still comply with all existing Thai laws, including the Mining Act and open bidding/tender processes. This provision does not grant exclusive, automatic, or monopolistic rights.
• Analysis: While not a “right” in the strictest legal sense, this clause does provide a powerful political and commercial signal. US companies will likely receive strong diplomatic and institutional support for their proposals. Companies from other countries may perceive this as a new barrier to entry, while Thai partners seeking US investment now have a clear framework to leverage.

Investment Considerations

US companies, particularly in the mining and energy sectors, now have a clear, government-backed invitation to explore investment in Thailand, and an incentive to begin due diligence, identify potential local partners, and engage with relevant ministries (e.g., industry, finance) to understand the project-approval landscape.

The MOU’s focus on downstream processing suggests that Thailand does not just want to export raw materials; it wants to build value-added industries (e.g., magnet production for EVs, advanced electronics). Companies in these sectors may find new incentives and a more secure local supply of necessary materials.

All investors (US and non-US) should look for an accelerated push to streamline mining and investment regulations. However, all projects will still be subject to Thailand’s domestic legal framework, including environmental impact assessments (EIAs), licensing, and foreign ownership rules. The 1976 Treaty of Amity may also provide relevant context for US investors seeking “national treatment.”

In addition, despite the Thai government’s emphasis on the nonbinding nature of the agreement, other parties may see that the MOU places Thailand more firmly within the US economic orbit in a highly sensitive sector. Businesses should monitor the potential for economic or trade-related countermeasures from other major powers.