China’s growing control over strategic minerals could be a threat to Canada’s national security, a former head of CSIS says, and Ottawa should recognize this when it reviews a proposed takeover of an Arctic gold mine by a Chinese state-owned conglomerate.
Shandong Gold Mining Co. Ltd., one of the world’s largest gold producers, is paying $207.4-million to buy TMAC Resources Inc., the latest struggling Canadian junior miner to be swept up by a larger and better-capitalized company.
The deal will be among the first pored over by Ottawa after it announced in April that it would bring “enhanced scrutiny” to bear on acquisitions by foreign state-owned investors in a period where the COVID-19 pandemic has driven down the value of companies. China is the largest producer and consumer of gold in the world.
Richard Fadden, the Canadian Security Intelligence Service director from 2009 to 2013, said Ottawa should examine the proposed TMAC takeover within the larger picture of Canada’s national interests and Beijing’s strategy of gaining control over critical metals and minerals.
Chinese companies have not only been active buying up gold mines around the world but Shandong Gold Group, the state-owned parent company, signed up in 2015 to back a national Beijing effort to stockpile the precious metal, which is considered one of the best hedges against economic volatility.
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