After United States sanctions cut off supplies of microchips for Huawei smartphones, alarm bells began to ring out across all Chinese industries deemed as pivotal to the country’s future development, but reliant on imported materials.
And the base metals sector is one of the key areas, according to the chairman of Zijin Mining, Chen Jing-He. “Now we know the importance of securing the supply of microchips and food, but how about the feed for metals production – mined metals?
China relies heavily on base metals imports, so if foreign sanctions cut off our supplies, it could be even worse than running out of smartphone chips,” Chen told delegates at a recent strategic development conference on gold held in Beijing.
Chen said the risk was particularly true in the Chinese copper sector, in which smelters take up more than half of the world’s total capacity, yet the country owns only 4.6% of global copper resources.
“If that day came – [of sanctions being applied to the base metals sector] – while China is still lagging behind [in terms of] mine exploration and development, the consequence would be too horrible to contemplate,” Chen said.