The world opens arms to China again
Source: www.mlr.gov.cn Citation: Citation: www.chinamining.com.cn Date: Nov.11, 2013
The annual China Mining ended quietly, but the passion voice at the conference from spokesmen of different nations has long lingered. They represent the five continents over 50 countries around the world, traveling far away to China, delivered their latest information in the field of mining to every corner of the world through mining congress.
In the forums of China Mining, representatives from Russia and central Asia, Chile, Canada, Australia, Greenland, Peru, Argentina and Africa and other countries and regions have given detailed introduction of their own mining cooperation projects and investment opportunities. Through the fog, we can see that the concern of the international mining industry is to encourage international cooperation and exchange, to mineral development technology, and to protect environment in mines.
In addition to spare no effort to promote and sell its own mineral resources, mining development policies and regulations, and so on and so forth, to welcome investment by Chinese enterprises is also their common aspiration...
Sufficient resources - the biggest temptation to investors
With the high-speed economic development situation, mineral resources, as “food” and “blood” of industrial development, are becoming more and more important. Due to the different mineral resources endowment and uneven distribution, many countries cannot be self-sufficient on the mineral resource demand. What’s the worse, in some countries, including China, a large number of mines have entered the middle-late period for mining. The situation of mineral resources is urgent. Other countries, especially African countries, have a wealth of resources reserves, but lack of mining technology and capital. As a result, the integration of the utilization of resources is imminent.
Information comes from the China Mining that the world`s largest mineral kingdom has gradually let go of mineral development policy. International exchanges and cooperation bring a new life to the industry.
In terms of mineral resources, every country participating the conference has carried on detailed instructions with respect to its advantages in mineral, and foreign mining areas are introduced. From the forum we can see, Africa is still a “hot place”, rich in mineral resources, and has great potential in mineral exploration.
Gold reserves in Africa have always been the concern. There is also metallogenic belt rich in iron ore resources located in the Congo (cloth), Cameroon, and Gabon etc. of central Africa. South Africa’s manganese production accounts for about 80% of Africa. Half of Chinese manganese consumption is from South Africa or other parts of Africa. About 3 billion barrels of oil reserves have been found in East Africa, and its potential may be bigger, which will be likely to reach 8 billion to 10 billion barrels of oil. There will be more and more oil discovery in Mozambique or other east African countries.
At the same time, other countries also attract the foreign enterprises’ investment with rich mineral deposits. In Australia, there is high quality coal resources, the world`s lowest sulfur content coal, and very rich natural gas resources. Compared to other countries, Australia’s coal is cleaner, and gas supply is more stable.
South America like Chile is full of opportunities. It is the world`s largest copper producer, whose annual output is 6.5 million tons, accounting for 32% of the world. As the world`s largest copper producer, Chile is the center of the mining industry in South America. 11 out of 15 of the world’s most important copper mining companies have established subsidiaries in Chile. Argentina also has an obvious advantage on mineral reserves. Its copper, gold, lead, molybdenum, lithium mineral developing and private enterprises and state-owned enterprises developing are obvious to all. The Argentine mining investment has huge potential.
Central Asia region such as Kyrgyzstan is rich in gold and oil reserves. Tajikistan is also rich in zinc, antimony, tungsten and other rare metals and non-ferrous metal reserves such as precious stones. Gold resource is very rich, and silver is the most important mineral resources.
India in the south of Asia is rich in mineral resources. At present, there are 39 species of the minerals mined, among which coal, lithium, chromium, iron ore, rare earth, manganese, and bauxite are abundant. In addition, India’s steel industry is also very active.
The Greenland in Arctic zone is rich in zinc lead, ruby, iron, zircon, rare earth elements and other mineral resources.
Preferential policy- another far mar to attract Chinese capital
It is worthy of attention that countries all over the world relax foreign investment restrictions gradually, and take a series of preferential policies to attract foreign capital. The biggest foreign policy window of this year’s China Mining is that Australia plans to cancel a carbon tax and mineral resources rent tax (MRRT) and increase investment in mining exploration, so that to build a good environment and invite Chinese investment sincerely.
In addition, Chile welcomes China with its open mind. At present, Chile has signed 22 free trade agreements with 59 countries or regions in the world. At the same time, the country has signed tariff-free dual agreements with 25 countries or regions in the world, and the agreement with China is being discussed. And Chile implements preferential rates for imported raw materials. Both in China and South Korea can put the raw material imported to Chile for processing and manufacturing.
Canada also emphasis on the lowest corporate tax rate, and it has the world’s best business environment. Canada has very strong strength in mineral development, geology, environmental management and finance. On the forum of investment in Canada, Marian Campbell Jarvis, Assistant Deputy Minister for the Minerals and Metals Sector, Dept of Natural Resources, Canada said “We have a very stable and transparent regulatory system and investment environment, and also has a responsible resources development system, which helps to improve enterprises’ efficiency. Furthermore, the foresight of examination and approval is transparent and the whole process is very smooth. In addition, Canada is the very safe and reliable provider of energy minerals and metals. We are looking forward to strengthening cooperation in investment, science and technology, and establishing cooperative partnership with other countries.”
As to foreign capital, there is no limitation in Kyrgyzstan, let alone 25% or 30% of the holdings limited. The investment environment is very attractive. However, at present most of China’s investment in Kyrgyzstan are relying on other countries as an intermediary. Kyrgyzstan is looking forward to establishing relations with China directly.
In the Russian federation, there are several main laws affecting the investment in the field of mining, including the Subsoil Resources Law and the Underground Resources Development and Licensing Regulations that went into effect in 1992, as well as law No. 57 and No. 58 promulgated by the federal on May 7, 2008. Among them, the business of No. 57 rules and regulations involves that holdings of important plot mining company should be limited within 10%, and all activities should be examined and approved in advance. But according to a new revised in November 2011, the restriction of foreign ownership was raised from 10% to 25%. That is to say, if foreign investment accounts for a 25% stake or below, its activities could run without approval. In addition, on the forum of investment in Russia and central Asia, Nikolay Matyash, Executive Director, Mining Advisory Council, said “Despite these limitations, the Russian government is hoping to promote foreign investment in exploration.” The Russians think that underground resources exploration should be implemented for all single license, and 57 and 58 regulations should be further revised, which can make Russian investment environment more friendly for foreign investment.
“We will go to visit xi’an this time. Some corresponding cooperation agreements will be signed, and talents in the field of exploration will be imported from xi’an, to guide our exploration work.” On the forum of investment in Russia and central Asia, Director of Tajikistan Geological Exploration, said “Now tajikistan not only actively strengthen cooperation with China in mining technology, and construct and perfect the legal mechanism to attract more foreign investment.”
Zimbabwe takes duty-free policy, encouraging the introduction of advanced mining technology. “There are so many investment opportunities in Zimbabwe mining, including the infrastructure, development of mining, and selecting mining”, Walter K.Chidhakwa, Minister, Ministry of Mines and Mining Development, Zimbabwe， pointed out on ministers’ forum of CHINA MINING that “We encourage foreign companies to invest in mining industry, especially encourage them to use the best technology to reduce costs and increase profits. For the introduction of advanced technology and equipment, Zimbabwe takes duty-free policy, hoping to promote the development of the native mining technology by encouraging foreign investment.”
“Because we had a lot of laws in this aspect before, the foreign capital was limited to enter. We have conducted a series of reforms to attract enterprises to invest in mineral development, and the related laws and regulations of prospecting and mining have been simplified to be more suitable for the domestic and foreign mining investment”, said Milan Bacevic, Minister of Natural Resources, Mining and Spatial Planning, Serbia. In addition, she also mentioned that Serbia planned to hold an international mineral resources investment fair in the next year in March or April, and welcomed everyone to take part in it actively.
There are a lot of mining investment laws and some tax incentives in Madagascar. After running for 5 years in Madagascar, companies can apply for income tax reducing, mining operation tax can also be reduced by 25%, and processing operation tax can be reduced by 10%. In addition, there are international arbitration clauses in Madagascar for enterprises to provide a convenient channel to protect their rights.
Jens-Erik Kirkegaard, Minister, Greenland Autonomous Government, Ministry of Industry and Mineral Resource, said: “Greenland has changed the policy for radioactive resources, and cancelled the ban on the radioactive uranium and rare-earth drilling.” In addition, he also said that there is a new mining license in Greenland, including iron ore, ruby, rare earth, lead and zinc, and so on. These are the latest progress in the mining industry of Greenland. There are certain conditions for applying for mining in Greenland. The first is to hold comprehensive hearings. Secondly, as Greenland is much concerned about the mining’s benefit to the society, it is necessary to ensure that both the society and the company could obtain corresponding profits from the mining development.
At the China Mining 2013, different countries showed their investment potential with rich mineral resources and preferential policies, and invited foreign capital injection, including China. We are at the start of economic recovery and the global economic structure is under reshuffle. It is a very good opportunity to develop for China’s mining industry and the world economy.
The construction of infrastructure and safety - factors must be considered
While countries are scrambling to introduce themselves, we also have to face the severe challenges to co-exist with them.
Africa has been a piece of Brown Cake rich in treasure of mineral resources to other countries for a long time, and the phenomenon of “hot” mining in Africa continues till now. However, as foreign investors, we have to take its backward infrastructure construction, lack of mining technology and unsafe social environment into consideration.
At this year’s China Mining, spokesmen from the African countries have repeatedly stressed that the government vigorously strengthen the construction of national infrastructure, to create a good investment environment for investors. However, thinking calmly, the African economy is after all relatively backward- infrastructure construction starts late; its mining fields are most in mountainous areas; traffic is extremely inconvenient; mining environment is relatively poor. Take the iron ore metallogenic belt in the Congo, Cameroon, Gabon as an example. There are very large resources reserves in the area and it is also a place full of opportunities for development. But there are a lot of restrictions with the infrastructure here, which requires investors to develop roads and other infrastructure. Other metallogenic belts, such as Guinea, Sierra Leone and Libya, develop faster. These countries haveupgraded the railway transport recently while shipping is relatively more developed.
There are the problems of miscommunication, racial discrimination, and even security issue, which may exist in all countries. There is attractive environment in Africa. Let’s take Botswana as an example, which is an ideal place for investment with very good power grid, power generation, power generation equipment, railway and highway, etc. But what makes many investors hesitate is too much negative publicity on the Internet. Africa is an extremely large place with complex regions, and it will naturally leave a stereotyped impression to investors. They may think there are a lot of mysterious things. In addition, there are miscommunications, especially the personal safety problem. Of course, the problem exists in other areas, and it is an unavoidable risk. As to the solution, the local government’s policy construction and publicity is a very important aspect, and some multinational mining organizations can also play their role.
Environmental protection and scientific and technological innovation-stride the threshold
In addition to the two challenges existing since ancient times, namely construction of infrastructure and social security has, the mining investment now faces with the challenge with the times characters.
Referring to mining development, countries no longer simply focus on economic benefit, but are more concerned about the balance between economic and environmental benefits. From the previous mining conference till now, the green and harmonious mine construction has always been the theme.
At the national project promotion, we all agreed on that with the introduction to mineral resources, treasure cannot be under escort at the cost of the ecology. Calls for green mining are becoming higher around the world. It has become the challenge of the times to develop the advanced prospecting technology vigorously, and to promote green and harmony mine construction.
“Although rough mining way with environmental abuses will bring more profits, it is necessarily the wrongdoing to ruin the future in the long term.” On the promotion conference, The Minister of Minerals of the Sudan specially emphasized on the importance of environmental protection and the miners’ health, and pointed out that Sudan had adopted a series of measures to safeguard the rights and interests, including the corresponding laws. At the same time, the qualification certificate for the mining right was limited- both the mining license issuing and mining period extension required the approval from the mining minister personally to ensure that investors can comply with the law.
On the forum, Mary Ann Campbell Jarvis said that Canadian invests in science and technology, strengthen environmental protection, improve energy efficiency, and reduce the pollution of tailings. At the same time, Canada has also established a special action in earth science to provide the next generation of technology, especially the technology to help with in-deep development. Canada greatly admires that the enterprises take social responsibility in the process of mining.
On the forum of mineral resources management in China and Canada, Bruce Madu, Director of Mineral Development of British Columbia, Canada, introduced mine reclamation measures in the province in detail, which is of very important significance to the world’s mine reclamation. Its gradual reclamation is the focus of the management work. The Canadian government proposes the progress of the reclamation and research reports every year which update every five years. Every mining license need to pay the security margin and the deposit. If it doesn’t comply with the related articles of reclamation on the license plate, mines and investigators can confiscate the deposit, or even shut down its mines.
“I remind investors in Peru that they need to pay attention to the way of water treatment, for that we are concerned about the problem of water pollution”, emphasized the Hon. Jorge Merino Tafur, Minister, Ministry of Energy & Mines, Peru, on ministers’ forum of CHINA MINING. On the one hand, water and power resources are very important for mining. In Peru, there are a lot of water resources are available in the aspect of the whole mining processing. At the same time, there are a lot of hydropower projects under development, and electricity is not a problem. On the other hand, as to the resource utilization, Peru especially emphasizes that attention should be paid to environmental protection. Mining production and processing prone to cause pollution and Peru regards the protection of the environment especially the water resources as important.
On ministers’ forum, Germán Elías Alba, Deputy Minister, Minerals andMetallurgy of Bolivia said: “I’d like to remind Chinese companies to pay attention to environmental protection if they want to make better investment in our country. From 2009, our country has been committed to environmental protection, and there was a new legislation. For example, there have been specified regulations for mining environmental protection in the Constitution and the Mining Act.”
India also attached great importance to the sustainable development of mining industry. “How to use the limited natural resources is a challenge to the world mining industry. We have formulated the related laws and regulations to maintain the ecological protection and sustainable development in the process of development. We hope to exchange experience and promote development through the communicating with the world.” said Shri R.H. Khawaja, State Secretary, Ministry of Mines, India, on ministers’ forum.
In addition, the speakers on the forum, especially spokesmen from African countries, emphasized the importance of technology innovation. Walter K.Chidhakwa, Minister, Ministry of Mines and Mining Development, Zimbabwe, emphasized that Zimbabwe encouraged mining companies to reduce development costs with the best technology and ensure product quality. There is the tax-free policy for equipment needed for importing technology. Zimbabwe welcomes investors bringing advanced technology.
Namibia also hopes that foreign investors can bring more new technology and further strengthen its investment in infrastructure. The Namibian government is willing to strategize with investors, and promote the mining industry in Namibian for sustainable industrial development.
Different situations call for different action. Facing various challenges and opportunities, we believe that the global mining industry should strengthen communication and cooperation to find a win-win way to solve it.
Social responsibility - the enterprises’ duty
South Africa is rich in resources and the first choice for mining investors. However, we must have the social responsibility while mining, and be responsible for the country investing and the local residents.
In order to ensure the investment companies’ sense of social mission, not only the approval mining projects in South African have to be examined, but also they have to get social permission. On the forum of investment in Africa, Joel Raphela, Deputy Director General, Mineral Regulation, Dept of Mineral Resources, South Africa, said: “We have been paying attention to the development of mineral resources, and also allocate resources to realize the reasonable allocation of resources. In our country, we strengthen the laws of the health and safety of the mining in order to reduce the number of miners casualties as far as possible, also had legislation on diamonds and precious metals to improve the investment environment in our country.”
At the same time, the effect of mining development to promote social employment in South African is promising. South Africa has developed social and labor related solutions, aiming to solve the problem of human resources and local economic development. Moreover, the approval mining project in South African not only has to be examined. South Africa is very concerned about safety and miners’ health problems of the project. Each project has to get social permission before running.
Partners – stimulate the potential of Mining
With the in-depth development of economic globalization, we are no longer in the solo and closed age but have entered the efficient time by win-win cooperation. Now mining development should no longer be behind closed doors either, but bulk so as to create the highest economic benefits in the form of win-win cooperation.
The China Mining this year has paid more attention to exchanges and cooperation between countries. A display platform was offered to mining cooperation projects and investment opportunities on the international mining industry seminar, in order to achieve the purpose of strengthening pragmatic cooperation between countries.
Looking back the China Mining 2013, we can find that the world’s major mineral resources countries, such as Australia, Kyrgyzstan, Tajikistan, Sudan, etc., have maintained long-term and close partnership with China. Ian MacFarlane, the Industry Minister of Australian said in a speech that all investment from China would be popular in Australia. This spirit should be reflected in the final agreement.
Taking this opportunity to ponder, we have fully understood that the natural resources projects in Australia are large in scale. However, at the same time, it also means a huge investment. Instead, China is humongous, but less in per capita resources. There is an increasing demand for resources along with the economic development and social progress. Cooperation in mining in globalization era provides a good opportunity for the supply and demand docking. China Mining, as one of the four largest mining events in the world, is to grasp the opportunity and provides a platform of cooperation between countries.
The world needs China, and China should integrate into the world. As the China Mining 2013 ended, countries agreed on that only by establishing effective partnerships could the unlimited potential for development be stimulated.（Wu Haiwei）（translated by TLRHVC）
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