China’s Virtue Dragon joins Indonesian nickel rush – by Jack Hewson (Asia – December 7, 2016)

Top executive confident policy will continue to support investment

JAKARTA — Andrew Zhu admits that when he arrived in Indonesia in 2014, he was a little headstrong. He had come in a hurry to set up local operations for Chinese metals producer Jiangsu Delong Nickel Industry, founded by Dai Guofang, his father-in-law.

At 29, Zhu is notably young to be president director of Virtue Dragon Nickel Industries, a company managing a $1 billion dollar investment. He is also refreshingly candid.

“You know it was brave for our company to come here, and slightly reckless,” he told Nikkei Asian Review in his office in downtown Jakarta. “We just didn’t have time to conduct thorough due diligence.”

Zhu’s rushed arrival had been prompted by severe restrictions on the export of unprocessed mineral ore imposed by the Indonesian government in January 2014. The measures had serious implications for Delong’s imports from the country. While exports of low-grade concentrates of copper, manganese, zinc, lead, and iron were to be allowed until 2017, nickel and bauxite ore shipments faced an outright ban.

Industry observers question how much Indonesia’s blunt-force mining policy, intended to promote investment in downstream processing, has succeeded in its aims, while costing producers billions in lost revenue.

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