International Mining Industry in Post Financial Crisis Period
- Sidelights on CHINA MINING 2011 Summit Forum
Source: China Land and Resources News Citation: China Land and Resources News Date: Nov. 9, 2011
As time goes by, global financial crisis fades away, but Europe’s debt crisis is increasingly intensified. Mining industry recovered quickly after a heavy toll from financial crisis. Like a supernova with extraordinarily strong light, the industry is showing new changes and trends to the world.
Information disclosed by senior mining officials of participating countries is different from a year ago at CHINA MINING 2011 Summit Forum. The trend in international mining industry is changing gradually.
Chinese Mining brings promise to the world
For many countries which just got over financial crisis, the struggle is really hard in the past year. However, those countries owing abundant mineral resources and taking mining industry as pillar industry bore much less economic recovery stress. Mining industry sent a dose of confidence to their economic recovery. And the strong demand from China in the recent years largely benefited every country that cooperated with China in mining. Just as Angolan Minister of Industry, Geology and Mines Joaquim Duarte Da Costa David said, “Chinese mining brings promise to the world.”
As a matter of fact, not only in financial crisis period, Chinese mining always persisted in harmonious co-existence and common development with every partner from its first step into international arena. Especially for those developing countries with rich mineral resources, inflow of Chinese capitals helped them go out of the dilemma that they do not have enough financial power to develop these mineral resources. China’s strong capital strength, advanced technologies, responsible attitude and profound humane care brought them not only leapfrog development in mining industry and substantial GDP growth, but also improvement of infrastructure, community environment and educational quality as well as other major changes. Senior mining officials from developing countries all expressed their gratitude to Chinese mining enterprises at the forum this year. Azim Ibrohim, head of Geology Administration under the Government of Tajikistan made a speech entitled Contribution of Chinese Mining Enterprises and Other Concerned Foreign Enterprises to Mining Industry of Tajikistan. He commented that, Chinese mining enterprises made a great contribution to the mining industry of Tajikistan. “In last four or five years, I always actively participated in CHINA MINING and took advantage of the conference to make extensive communication with our peers. Chinese enterprises know well what we need and what we want to do. Many Chinese enterprises entered Tajikistan market and the number is increasing year by year from a dozen to several dozens, and now we have hundreds of them back in my country.” Laos is a mining country which is quickly rising. In the past five years, Laos maintained an annual GDP growth of 13.87%, to which, mining industry made a great contribution. In 2009, mining industry exports accounted for 60% of total exports of Laos. Chinese companies also made undeniable contribution to the development of Laos’ mining industry. Deputy Minister of Energy and Mines of Laos Somboun Rasasombath said, there are more than 60 Chinese companies that have invested about 110 projects in Laos, 18 in exploration stage, 50 more in detailed exploration stage and 42 are under mining now. The Minister of Mineral Resources of South Africa Susan Shabangu confessed straightforwardly that, rapid GDP growth of South Africa in recent years has undeniable connection with China. Enthusiastically Introduce and Recommend Resources and Welcome Foreign Investment Inflow of foreign capitals offered many mining countries, especially developing mining countries, a chance to enjoy a prosperous economy. At the summit forum this year, ministers of mineral from each participating country also welcomed mining investment and enthusiastically introduced and recommended abundant mineral resources they behold. Abundance of mineral resources is a core factor in attracting mining investment. In their addresses, senior mining officials intensively introduced resources endowment of their own country and the solid foundation laid for the mining industry. Joaquim Duarte Da Costa David said, Angola has rich natural resources and the government is carrying out a nationwide geological survey and geophysical exploration, so probably more natural resources reserves will be explored in the future. Besides, Angola has examined and approved many iron ore prospecting right. It is believed that, in the coming three or four years, many prospecting projects will turn to mining projects and more mines will be constructed. He also promised that Angola will further improve mining environment, complete legal system and optimize national political institutions so as to accommodate foreign countries’ mineral resources development. The Tajikistan government recently formulated and unveiled a series of policies, stating explicitly that they are going to further develop mining industry and increase input on geological prospecting and mineral exploration. Azim Ibrohim introduced that, well endowed with various resources, Tajikistan presently has more than 1,000 mineral deposits under development and production and has issued over 50 mineral rights related licenses to foreign mining enterprises. B. Ariunsan, Deputy Minister of Mineral Resources and Energy of Mongolia, said that Mongolia’s economic growth and development are derived from open economical cooperation, so they hope a continuous cooperation with China and they always see China as the biggest partner for Mongolian mining. India showed a good faith in foreign mining investment at this forum. Shri S. Vijay Kumar, State Secretary of the Ministry of Mines said, this is their second participation in CHINA MINING and the delegation is much expanded compared with last year. Many Indian companies take part in it and many cooperation agreements are concluded. He also elaborated abundant natural resources in India and stressed that India unveiled a series of favorable policies for mining industry development in recent years. For example, the natural resources policy introduced in 2008 encouraged investments of private companies in mining industry. Geological Survey of India is now making a nationwide geological survey and a 1:50000 geological mapping has been completed. Many spatial data, gravimetric data and geochemical data were released on public website so that mining companies may apply for prospecting right accordingly. Even Australia, which has implemented “super” mining tax, also welcomes Chinese investors. Minister of Resources, Energy and Tourism Martin Ferguson AMMP stated that, Australia offers national treatment for all companies from participating countries. Meanwhile, it amended unnecessary contents in mining investment policies last year and foreign investors can make better mining investment. Higher mining investment threshold Although many countries explicitly promise to be open to foreign mining enterprises, they seem less urgent than last year when they still suffer from financial crisis. Indeed, after undergoing resources-relied development, every mining country is bound to actively protect domestic resources and increase value added of mineral products as possible as they can. From another perspective, scarcity of mineral resources make national protectionism in mining industry a sensitive and subtle factor for parties involved in international mining industry to balance. According to the information from the summit forum, a common appeal is to carry out mineral product intensive processing in the home country. B. Ariunsan said that, the government would implement a new plan to further cooperate with foreign investors in preliminary and intensive processing of mineral products. They plan to further carry out preliminary processing of iron ores and intensive processing of coal in the coming three years. Steel making and copper smelting are also listed in the plan. Azim Ibrohim early stated his desire to conduct intensive processing of mineral products in Tajikistan at CHINA MINING of last year. He emphasized again that, Tajikistan expects mineral resources to be intensively processed as end products in the country and it would like to intensify cooperation with foreign companies in this field. Continuous unveiling of new mining industry policies is another feature at CHINA MINING this year, which brings more uncertainties to foreign investment in mining industry. For instance, Australia recently threw out a mineral resource rent tax (MRRT), which will be implemented from July 2012. This taxation ensures that Australia obtain returns via tax levy. Martin Ferguson said that, this taxation policy will also make for foreign investors, because if the project guarantees a long-term and stable return, they need not pay the tax. However, for foreign investors, there are numbers of factors out of control in the process of maintaining long-term and stable return. Moreover, in order to better protect and develop mining industry, many countries are amending mining laws and acts. In August, Indian parliament reviewed and adopted Mineral Resources Amendments Act. Shri S. Vijay Kumar said the Act will manifest its impact on mining industry in the future years. The Ministry of Energy and Mines of Laos even set up a new department, which sufficiently proves its stress on mining industry administration. For Chinese mining enterprises, some depressing information was conveyed at this forum. Although Martin Ferguson said Australia would offer national treatment to all companies from participating countries, merely 7 out of over 3,000 Chinese investment proposals were eligible in the past several years. By this token, there are a lot to be done for Chinese mining enterprises in the process of foreign mining investment.
CHINA MINING Congress and Expo 2011 attracted over 5000 delegates, exhibitors and visitors from 55 countries and regions, increasing by over 650 people as compared to the last session. There were 382 domestic and foreign exhibitors, increasing by 38% as compared to the last year. The exhibition area amounted to 25000 square meters, more than doubling that of the previous session, with 1,050 standard booths, increasing by 65% compared to the previous session. There were a total of 23 forums and 7 projects shows held with 425 promotion and negotiation projects introduced by the congress, increasing by 32.8% as compared to last year. At the project signing ceremony, 55 projects were signed, amounting to RMB15.7 billion, increasing by RMB 4 billion and by 34% as compared to the previous year. More than 40 foreign VIPs including 23 mining ministers and vice ministers as well as ambassadors in China from 18 countries and regions such as Australia, Canada, South Africa, Angola, etc. attended this session of the congress. Meanwhile, the congress attracted more than 100 medias and over 200 journalists from home and abroad to cover the congress. In terms of number of delegates and scale of exhibitors and booths, the CM2011 all topped the previous sessions, ranking the world’s premier mining congress and expo..CHINA MINING Congress and Expo 2012 will be held at Meijiang Convention and Exhibition Center in Tianjin on November 3rd-6th, 2012 (Expo will be opened on 3rd pm Nov., 2012). We invite you to join the event and to celebrate the 14th anniversary of CHINA MINING with us. For more information about CHINA MINING 2012, please visit:www.chinaminingtj.org