THE NEW WEALTH OF NATIONS BEYOND EXTRACTION: THE ROLE OF RARE EARTH ELEMENTS AS CATALYSTS FOR INNOVATIVE AND COMPETITIVE PRODUCTION ARRANGEMENTS IN THE ECONOMIC COMPLEXITY OF BRAZIL

Abstract

Advocated by economic sciences, microeconomic agents – households, the state, and firms – interact through the factors of production (land, labor, capital, and technology), driving economic development. In this context, this article discusses how the systematic mapping of rare earth elements can guide industrial policies, attract investments, and foster local productive arrangements, thereby generating positive externalities such as innovation and cost reduction. The demand for rare earth elements has emerged as a strategic resource, essential for high-technology sectors, renewable energy, electronics, and national defense. Their exploitation has the potential to enhance Brazil’s economic complexity, stimulate the creation of industrial clusters, and strengthen national competitiveness. However, significant logistical, technological, and regulatory challenges remain, limiting the integration of these minerals into sophisticated value chains. Thus, this study investigates how the identification and strategic use of rare earths can contribute to the diversification of the Brazilian economy, fostering a new industrial base of high value-added goods. Furthermore, it examines how efficient logistics, coordination among economic agents, and the formation of specialized productive arrangements can mitigate the country’s long-standing dependence on traditional commodities. The aim is to demonstrate that integrating extraction, processing, and technological applications represents an opportunity to reposition Brazil within the international arena, linking sustainable development to economic sovereignty. The study focuses on the need for integrated public policies, territorial governance and institutional strengthening to transform the potential of rare earths into effective vectors of sustainable and complex development.