Five years after the sanctions, Americans returned to Nairobi. And this time, the discussions were not just about politics.
According to an exclusive report by Reuters on October 8, Michael Vance, the Assistant Secretary of State for Intelligence and Research at the U.S. Department of State, participated in talks with Min Aung Shwe in Naypyidaw, the capital of Myanmar, from September 15th to 16th. This was the highest-level direct contact between the U.S. and the military government of Myanmar since the military coup in 2021.
On the surface, there is a very specific trigger for this contact: to rescue the American businessman Adam Castillo who has been detained for three months. However, what the United States really wants is clearly a greater influence on the political landscape of Myanmar, and the establishment of a new rare earth supply chain, thereby gaining geopolitical and economic advantages over China.
At a deeper level, this also means that Trump will take political transactions onto top of diplomatic policy again prioritizing democracy and human rights.
The Castillo who directly led this encounter was not an ordinary merchant.
The 40-year-old Castillo was once an officer in the United States Marine Corps. He lived in Myanmar for a long time, operating a security risk management company called AGS Myanmar. From 2023 to 2025, he served as the chairman of the Burmese American Chamber of Commerce. More importantly, he has been lobbying in Washington for a policy that aligns with Trump’s ideas regarding Myanmar: the United States should not continue to simply sanction and isolate Myanmar, but should instead renegotiate with local authorities. One of the rewards of this renegotiation would be access to Myanmar’s rich rare earth resources.
It can be said that he is the person with the most friendly attitude towards Myanmar among the Americans. But it was this very person who was arrested by the Burmese side.
On June 11, 2026, Castillo returned to Yangon after completing his trip in Malaysia. He was detained by Burmese authorities at the airport. He had been promoting his memoir “Finding Our Voice” overseas. In the book, he criticized both the Burmese military and the U.S. sanctions policies. He argued that Washington’s sanctions harmed ordinary citizens and businesses, but did not truly change the behavior of the military.
The official charges are not related to the statements in the book, but rather involve a highly complex dispute within the American Chamber of Commerce.
The Burmese-American Chamber of Commerce accused Castillo, during his tenure as chairman, of promoting the establishment of the "US-Burma Economic Forum" in the name of the chamber. Additionally, Castillo signed a contract worth approximately $300,000 with the Washington public relations firm Mercury Public Affairs, which is suspected of violating chamber regulations and constituting breach of trust. Castillo denies these accusations.
This dispute still remains controversial. A resolution of the chamber’s board of directors from November 2024 obtained by the Associated Press indicates that the board apparently approved the related lobbying efforts and authorized the hiring of Mercury. The current head of the chamber claims that the document is forged. Meanwhile, records of the chamber’s 2025 membership meeting published by the chamber itself show that Castillo’s proposal to establish a U.S-Myanmar Economic Forum was approved with 42 votes in favor and 8 votes against.
In other words, this is not an ordinary criminal case whose facts have been fully clarified. There may be underlying political struggles within the trade association behind this situation.
But in any case, Castillo's arrest ultimately led to action on the part of American officials.
Reuters reported that officials from the White House, the National Security Council, and the State Department were negotiating with the Burmese authorities through backdoor channels. A person familiar with the matter said that the Burmese side's request for a reward from Castillo was not monetary, but rather an expectation of a "proper level" of official U.S. contact.
This ultimately led to the inter-party talks in September.
On September 16th, Castillo was released and handed over to American officials, then flew to Bangkok. The statement given by Burmese official media is quite significant: his release was “considering the friendly relations between Myanmar and the United States”.
And once the United States re-enters negotiations, the topic of discussion soon moves away from Castillo himself.
Castillo has previously communicated with senior members of the U.S. government and presented a rather straightforward proposal to Washington: the United States could regain influence by easing sanctions and acting as a mediator in Myanmar's civil war, in exchange for access to local rare earth resources. According to The Associated Press, he was given the opportunity to meet with senior Washington officials to promote the idea of “relieving sanctions in exchange for rare earth access.”
Reuters confirmed that one of the key points of US-Myanmar contact is to request Myanmar's cooperation in closing the scam camps targeting Americans. The FBI has also been in direct contact with Burmese authorities regarding online scams. More importantly, US officials have discussed the issue of obtaining Myanmar's rare earth resources.
These two issues are exactly those that have become increasingly difficult for the United States to resolve in the past few years by relying solely on “isolating Myanmar”.
The first is fraud.
Southeast Asia has become one of the most important bases for global telecommunication fraud industries, with the border between Myanmar and Thailand being a core area. Many fraud operation centers are not located in areas that can be fully controlled by the Burmese government; instead, they rely on local militias, ethnic armed groups, and cross-border criminal organizations to survive.
This means that the United States faces a very realistic paradox:
To eliminate the Myanmar fraud ring, Washington finds it difficult to completely bypass Honein and the complex armed power networks in the region.
But the second issue is clearly more strategically important – heavy rare earths.
Kachin State in northern Myanmar, located near China, is one of the world's most important sources of heavy rare earths. Elements such as dysprosium and thulium are essential raw materials for high-performance permanent magnetic materials, and they are crucial for electric vehicles, wind power equipment, robots, and some advanced military equipment.
This is precisely the most difficult part of rebuilding the rare earth supply chain in the United States.
In recent years, although the United States has invested a large amount of funds in developing rare earth resources in its own country and allied nations, what truly cannot be replaced by others is not just mining, but also the subsequent processes of separation, refining, and the magnetic material industry chain.
The location of Myanmar on this map is very special: it serves as an important upstream source for China's rare earth industry. It is also closely connected to Yunnan in China, and connects the Bay of Bengal with the Indian Ocean. China has been operating in Myanmar for many years through the China-Myanmar oil and gas pipeline, the Giao Pho port, and long-term border trade.
The United States is now re-engaging with Minion Lai. What truly deserves China’s attention is not whether Washington will be able to transport Myanmar’s rare earths tomorrow.
In fact, it is still far from this stage.
The most important rare earth mining areas are currently controlled by the Min An Lei government in only a small part of them, while the rest are under the control of ethnic armed groups such as the Kachin Independence Army. Reuters also noted that American officials are aware of this obstacle, and that China is currently the main buyer of these minerals. Any intervention by the United States could be seen by Beijing as a challenge.
It is also worth noting that Vance did not only have contact with the military government.
Reuters reports that he has also been in contact with Myanmar's democratic opposition forces and ethnic armed groups that are fighting against government troops, both face-to-face and online.
This indicates that what the United States is actually doing may not have suddenly changed from “opposing Min Aung Lee” to “supporting Min Aung Lee”.
More precisely, Washington is beginning to re-enter the entire Burmese political landscape.
In the past five years, the United States’ policy towards Myanmar has been based on the framework of “sanctions against the military and support for democratic forces.” The problem is that while the United States has reduced its contacts with parties that hold real power, China has been able to interact with both the central government, ethnic armed groups, local business networks, and border forces.
This is also a truly unique place concerning the Castillo Incident.
A American businessman who originally tried to push the idea of "bartering rare earths for contact" in Washington was arrested in Myanmar. In order to rescue him, the United States had to negotiate directly with Min Aung Le. Once both parties sat down at the table, the topic quickly returned to the matter that Castillo had been pushing earlier—rare earths.
Fraudulent Zone, and provided Washington with another politically easier-to-explain reason.
So, what was initially thought to be just a case of consular intervention could potentially lead to one of the most significant adjustments in the United States' policy towards Myanmar over the past five years.
Washington seems to be starting to accept a reality:
If the United States wants to dismantle the Southeast Asian fraud network and reduce its dependence on China's supply chain of heavy rare earths, it is impossible for them to continue treating Myanmar as a country that can be bypassed.
Castle is the first key to open the door, and anti-fraud gives the US a reason to stay inside the door.
The real change that is taking place behind the door is that Trump is changing the tone of U.S. foreign policy: Of course, the United States recognizes the importance of Myanmar. However, over the past few years, due to issues such as democracy and human rights, Washington politicians have preferred to maintain a distance from the Burmese military government. But now, Trump can put interests above any moral issues.
