Updates to this story
Toshiba has signed a Memorandum of Understanding with Mongolia for the co-development of the country's rare earth materials.
The agreement with the Japanese company will include uranium, rare earths and rare metals, which could ruffle the feathers of China.
International concern has been growing over the monopoly perceived to be held by China, which currently controls over 90 percent of the world’s supply of rare earth elements and has tightening export quotas.
Countries across the world have been nervous over China’s export limit decisions. Earlier this month the European Union tried to urge China to loosen its grip.
Japan has been looking to other nations with rare earth deposits for help. Mongolia's partnership with Toshiba, a Japanese company, looks like it will set the ball rolling.
Back in October Japan’s prime minister Naoto Kan met the Mongolian president Tsakhiagiin Elbegdorj, where they agreed to build a strategic partnership to secure mutually beneficial cooperation in developing mineral resources in Mongolia.
Japan has also agreed to help Mongolia develop mines to exploit the valuable metals. At the time Kan was reported as saying: "Mongolia has high potential in mineral material development and this will serve the two countries' national interests.”
Kan added that Mongolia would be able to produce value-added products by using advanced Japanese technology.