China plans to keep small foreign firm out of gold sector

BEIJING—China, the world fourth-largest gold producer, plans new policies on foreign investment in its gold mining industry, allowing in only the largest overseas players, state media said Thursday.
“The new policy is designed to improve the quality of foreign investment to ensure sustainable development of the sector,” an unnamed source told the China Daily.
The newspaper did not give details about the policy, saying only that an announcement would be made before the end of the year.
It would seem to conform with a new strategy to focus not just on the “quantity” of foreign investment but also its “quality,” attracting foreign companies that do not squander resources or wreak havoc on the environment.
There are currently more than 100 foreign companies investing in China’s gold mining sector but most are small and many often withdraw quickly after making a profit, the China Daily reported.
The newspaper cited instances where small foreign companies had prospected for gold in China, utilizing only the high-grade resources while leaving less easily exploitable low-grade gold ores.
“This has generated immense waste of precious gold resources which is harmful to the sector’s sustainable development,” said Cui Lin, a gold analyst with Antaike Information Development, a mining industry research firm.
Gold production in China rose 8.05 percent in the first three quarters of the year to 169.3 tonnes, the newspaper said, citing the China Gold Association.
For the full year, gold output is expected to reach a record 240 tonnes, up from a little more than 224 tonnes in 2005, according to the report.—APP