Aussies invite foreign investment, China's concern remains

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(Xinhua)
Updated: 2009-10-21 22:44

TIANJIN: Australian state government and industry officials Wednesday extended invitation to Chinese investment in the mining sector, but their remarks didn't help dispel concerns of Chinese mining companies.

The officials from Australian states, including the New South Wales, South Australia, Western Australia and Queensland, and some industry associations, attended the three-day 2009 China Mining Conference with hopes of boosting investment sentiment from China following a spate of failed mining asset purchases.

Lylea Annemcmahon, vice mineral resources minister in New South Wales, said she hoped Chinese businesses would invest in the state which boasts large swathes of unexplored mining areas.

The state government strongly supported mining exploration and development and foreign investors could easily get exploration rights through bidding, Annemcmahon said at the conference, which runs till Thursday, in the northern port city of Tianjin.

The bidding wouldn't be disturbed by political elements, the official said. Whether or not foreign investors could win the bidding depends on factors including their technology, environmental conditions, marketing and ability to grasp opportunities, she said.

Foreign investors could also make joint investment with local prospectors, or take stakes in local mining companies, she stated.

New South Wales has four world-class metal ore deposits. It is also Australia's largest coal producing region, with coal exports accounting for 40 percent of the country's total.

Paul Holloway, South Australia's Minister for Mineral Resources Development, said he understood Chinese companies' worries over Australia's investment environment.

He said Chinese companies may receive the wrong signal after Australia delayed or rejected several investment projects from China.

Simon Bennison, chief executive of the Association of Mining and Exploration Companies (AMEC), said foreign investment on some important mining assets in Australia need approval from the Foreign Investment Review Board to avoid threats to the national security, environment and rights of local inhabitants.

While most foreign investment is subject to approvals by the state governments, which, however, have no limits on such investment, Bennison said.

Actually, foreign investment can give a strong boost to mining activities in Australia, he said.

Bennison added that many places in Australia, though a big resources country, are yet to be explored and developed and in dire need of foreign investment and technology.

Jeff Turnor, a senior member of the Australian Trade Commission, said Australia and China enjoy very high complementarity in the mining industry.

Australia has bright prospect for mining development, while China has a huge market and sufficient fund, Turnor said.

But the gesture of welcome made by Australia's local and industry officials failed to dispel concerns of executives of Chinese mining companies.

The Australian side said they welcomed foreign investment and wouldn't discriminate against Chinese investors, but it answered no questions like whether or not China can take a majority stake in a Australian miner and transparency over approval time limit and process, said Chen Jinghe, chairman of Zijin Mining Group Co. Ltd.

Some small and medium-sized Chinese prospectors also have concerns over environmental protection costs, labor laws and regulations, and attitudes of local residents, Chen said.

"Chinese miners shouldn't go overseas blindly as mining deals are more complicated than investment in manufacturing and there are no fixed modes. We on the whole are in shortage of internationalized professionals," Chen said.