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Media agenda: China buys newsrooms, influence in Africa – by Geoffrey York (Globe and Mail – September 12, 2013)

The Globe and Mail is Canada’s national newspaper with the second largest broadsheet circulation in the country. It has enormous influence on Canada’s political and business elite.

NAIROBI — When one of South Africa’s biggest newspaper chains was sold last month, an odd name was buried in the list of new owners: China International Television Corp.

A major stake in a South African newspaper group might seem an unusual acquisition for Chinese state television, but it was no mystery to anyone who has watched the rapid expansion of China’s media empire across Africa.

From newspapers and magazines to satellite television and radio stations, China is investing heavily in African media. It’s part of a long-term campaign to bolster Beijing’s “soft power” – not just through diplomacy, but also through foreign aid, business links, scholarships, training programs, academic institutes and the media.

Its investments have allowed China to promote its own media agenda in Africa, using a formula of upbeat business and cultural stories and a deferential pro-government tone, while ignoring human-rights issues and the backlash against China’s own growing power.

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Zimbabwe to develop economy with “new friends” like China – by MacDonald Dzirutwe (Reuters India – September 11, 2013)

http://in.reuters.com/

HARARE, Sept 11 (Reuters) – Zimbabwe will increase economic ties with friendly countries like China to develop its economy as Western nations maintain their sanctions after President Robert Mugabe’s re-election, the new finance minister said on Wednesday.

Mugabe, Africa’s oldest leader at 89 who won a fresh five-year term in a July 31 vote his opponents say was rigged, on Wednesday swore in his cabinet, including Finance Minister Patrick Chinamasa who was named on Tuesday.

Pointing to multiple flaws in last month’s election cited by domestic vote observers, Western governments, especially the United States, have questioned the credibility of the outcome and are considering whether to prolong sanctions against Mugabe.

However, African election observers broadly endorsed the voting and its result as peaceful and free.

Chinamasa told reporters the ZANU-PF party government had accepted the reality that the West would not remove financial and travel sanctions on Mugabe and his senior allies and would not release any direct financial assistance.

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CORRECTED-Asia stainless steel mills to benefit from Chinese nickel-pig-iron from Indonesia – by Polly Yam (Reuters U.S. – September 11, 2013)

http://www.reuters.com/

HONG KONG, Sept 11 (Reuters) – Chinese firms operating nickel mines in Indonesia are likely to step up plans to build nickel-pig-iron plants in the Southeast Asian country in order to continue shipping ores back home, which would help support higher production in China next year.

The move could mean Chinese firms’ supply of nickel-pig-iron, a low-grade ferro-nickel used in stainless steel production, would rise in Asia in 2 to 3 years time, helping regional mills such as POSCO and Nippon Steel & Sumitomo Metal to cut costs, industry sources said.

China is the dominant producer of nickel-pig-iron in the world and the output accounts for about a quarter of the global nickel production. But the production relies on imports of raw material nickel laterite ores, with Indonesia and the Philippines providing most ores.

Indonesia had planned to ban the export of ores from 2014 to push miners to build smelters at home to benefit the local economy. But in a policy reversal, it may now relax the ban in order to help support the rupiah currency and miners with smelters under construction will be allowed to continue to export ores.

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Insight – Changing China set to shake world economy, again – by Kevin Yao and Alan Wheatley (Reuters India – September 11, 2013)

http://in.reuters.com/

BEIJING/LONDON – (Reuters) – Long after concerns about tightening U.S. monetary policy have faded, a more profound issue will still dog global policymakers: how to handle the second stage of China’s economic revolution.

The first phase, industrialisation, shook the world. Commodity-producing countries boomed as they fed China’s endless appetite for natural resources. Six of the 10 fastest-growing economies last decade were in Africa.

China’s flood of keenly priced manufactured goods hollowed out jobs in advanced and emerging nations alike but also helped cap inflation and made an array of consumer goods affordable for tens of millions of people for the first time.

The second stage of China’s development promises to be no less momentous. Consumption will take over the growth baton from investment. Services will grow as a share of the economy, while industry shrinks. Commodity-intensive mass manufacturing based on cheap labour will give way to greener, cleaner ways of making things.

More of the value added by a better-educated, more productive workforce harnessing new technologies will stay in China instead of going to multinational companies.

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Guest post: can China help Kazakhstan to diversify? – by Usen Suleimen and Xiaojiang Yu (Financial Times/Beyond -BRICS – September 9, 2013)

http://www.ft.com/home/us

http://blogs.ft.com/beyond-brics/

Dr Usen Suleimen is ambassador at large, Ministry of Foreign Affairs, Kazakhstan. Dr Xiaojiang Yu is associate professor in the department of geography at the Hong Kong Baptist University.

The visit of Xi Jinping, China’s president, to Kazakhstan last weekend and the signing of $30bn of new agreements is another symbol of the growing closeness between two of the world’s largest countries. It is a relationship built on mutual challenges, geographic proximity and energy, as China increasingly looks to central Asia to power its growing economy.

But these links have also raised alarm bells in the west. Kazakhstan and Turkmenistan, the region’s main producers of oil and gas, have been warned against letting China dominate their economies. China has found itself accused of a modern colonialism as part of a new ‘Great Game’ and of plundering the natural resources of poorer, weaker countries.

From Kazakhstan’s perspective, such fears are badly misplaced. Our two countries have had warm relations for more than 20 years, fostered by close links at senior government level. We cooperate on a range of foreign policy issues, including through the Shanghai Co-operation Organization and the Conference on Interaction and Confidence-Building Measures in Asia.

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Timna copper mines dated to King Solomon era – by Aaron Kalman (The Times of Israel – September 8, 2013)

http://www.timesofisrael.com/

Radiocarbon dating of olive pits shows site was active during 10th century BCE, backing up Biblical account

New archaeological finds, including date and olive pits, have backed up the biblical narrative according to which the Timna copper mines in the south of Israel were active during the reign of King Solomon, around the 10th century BCE.

The findings — based on the radiocarbon dating of material unearthed at a new site in Timna Valley in the Arava Desert, and released last week by a team led by Tel Aviv University’s Dr. Erez Ben-Yosef — overturn a consensus that had held sway among archaeologists for several decades.

After the unearthing of an Egyptian temple from the 13th century BCE in 1969, most archaeologists believed that the site had been built and was operated by the ancient Egyptians. Before that find, the area was called “King Solomon’s Mines,” as a result of digs by archaeologist Nelson Glueck who found pottery shards from the 10th century BCE and said the copper mines were active during the time of the ancient Israelite kingdom.

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Old Economies Rise as Growing Markets Begin to Falter – by Nathaniel Popper (New York Time – August 14, 2013)

http://www.nytimes.com/

The balance of world economic growth is tipping in another direction. Just as economists have begun lowering their forecasts for China and many other developing economies, the American economy is bouncing back. Japan appears to have turned a corner and is ending almost two decades of grinding deflation. Economic data out of Europe on Wednesday provided the first solid indication that many countries in the euro zone may be escaping the clutches of recession.

The gross domestic product of the 17-nation euro zone grew at an annualized rate of about 1.2 percent in the second quarter. It is certainly not clear, based on only three months of data, that Europe’s recession has ended. But it is further evidence that the older engines of growth are revving into gear as the most recent sources of growth have been slowing down.

“The general proposition for much of the last generation has been that emerging markets grow faster. That’s what’s changed,” said Neal Soss, the chief economist at Credit Suisse. “The acceleration such as it is happening is in the first-world economy rather than the emerging markets.”

The growth of the BRIC countries — Brazil, Russia, India and China — has raised living standards in those nations and in others in Southeast Asia, Latin America and Eastern Europe.

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COLUMN-Fed tapering may boost coal, crimp oil in Asia – by Clyde Russell (Reuters India – September 5, 2013)

http://in.reuters.com/

(Clyde Russell is a Reuters market analyst. The views expressed are his own.)

(Reuters) – The turmoil in some Asian currencies created by the likely tapering of monetary stimulus in the United States is likely to spill over into commodity markets. While it’s obvious that as a currency depreciates, the local cost of commodities, which are normally priced in U.S. dollars, increases.

But what is less obvious is what the impact will be on the supply-demand balance for various commodities. Take crude oil and coal for instance. Both are major sources of energy, priced in U.S. dollars and easily traded.

But for many Asian countries, the price of oil has risen dramatically this year, while that for coal has remained steady, or even declined. The focus has been on India in recent weeks, given the South Asian nation’s efforts to stem the slide of the rupee, which has lost some 23 percent of its value against the U.S. dollar this year.

Brent crude is now at record highs in rupee terms, and is 26 percent above the level that prevailed at the start of the year. Given that crude is India’s biggest import in value terms, it’s clear that the government will want to spend less on oil in order to lower the current account deficit.

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Indonesia plans to soften foreign miners’ divestment rule (Reuters U.S. – September 5, 2013)

http://www.reuters.com/

JAKARTA – (Reuters) – Indonesia plans to relax a rule forcing foreign miners to sell majority stakes and allow those who make downstream investments to keep bigger holdings, a spokesman at the Energy and Mineral Resources Ministry said on Thursday.

Last year, the Indonesian government said foreign companies must reduce their stake in a mine to 49 percent or less within 10 years of production starting, though it has been unclear how the rules will be applied.

The rule was part of a push by Indonesia, which is the world’s top nickel ore, refined tin and thermal coal exporter, to generate more profits and influence in commodities markets.

“For those companies that integrate the upstream and downstream mining activities, they may have that divestment relaxation policy. Instead of divesting 51 percent to be achieved on year 10 of its activity,” ministry spokesman Saleh Abdurrahman said in an email.

“They may divest less than that, depends on the negotiation,” he said, adding there would be a revision to the current government regulation. He gave no timeframe for the change, but new regulations and rules can often get delayed in the lengthy Indonesian legislature system.

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UPDATE 1-Australia ships more iron ore to China as demand stays strong – by Wayne Cole (Reuters U.K. – September 5, 2013)

http://uk.reuters.com/

SYDNEY, Sept 5 (Reuters) – Australian shipments of iron ore to China looked to have stayed strong in August, a month after Australia boasted its second-highest exports ever to the Asian giant and a sign of healthy demand for resources.

Iron ore exports to China from Port Hedland, which handles about a fifth of the global seaborne market for the steel-making raw material, rose 9 percent in August from July.

Ore shipments of 22.3 million tonnes were up a hefty 33 percent on August last year and not far from all-time highs hit in May. Since the figures are released just a few days after the end of the month, they offer a timely leading indicator of demand in China.

Australia is the single largest supplier of the ore to China, ahead of Brazil. Iron ore is Australia’s single biggest export earner, bringing in around A$60 billion ($54.9 billion) in a good year. The strength of shipments increases the chance that Australia will report a trade surplus for August, and also add to economic growth.

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COLUMN-China PMI may not signal rising commodity demand – by Clyde Russell (Reuters India – September 3, 2013)

http://in.reuters.com/

(The author is a Reuters columnist. The opinions expressed are his own.)

(Reuters) – Commodity producers and traders have no doubt been cheered by the recent recovery in China’s key manufacturing sector, but the boost may be more to sentiment than actual demand.

This is because there is a fairly weak correlation between movements in China’s official Purchasing Managers’ Index (PMI) and imports of key commodities such as crude oil, iron ore and copper. There is a far better correlation between China’s imports and the price of these commodities.

This suggests that while stronger, or weaker, industrial growth helps set the direction for imports, the actual size of the movement in imports is more related to price.

The official PMI rose to a 16-month high of 51.0 in August, beating market expectations for a reading of 50.6, with the breakdown showing better conditions across the factory sector, including the key export orders category.

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China leads in resources buy-ups – by Paul Garvey (The Australian – August 31, 2013)

http://www.theaustralian.com.au/business

An analysis by The Weekend Australian found that Chinese interests bought $5.4 billion worth of Australian-owned mining and energy assets during the 2013 financial year, eclipsing Japan and Canada as the most active foreign investor in the sector.

While overall foreign acquisitions in Australia’s mining and oil and gas industries halved during the year, reflecting steep falls in both commodity prices and resource stocks, China’s investments in the mining sector held steady from 2012 levels.

The ongoing corporate activity challenges the notion that Chinese companies feel unwelcome when investing in Australia, following controversies over mining deals in recent years such as the blocked Chinese acquisition of OZ Minerals’ Prominent Hill mine and Chinalco’s failed deal to buy into Rio Tinto’s West Australian iron ore operations.

Comments during the week by Kevin Rudd, in which he said he was anxious about an “open-slather approach” to foreign investment, have reignited concerns about perceptions of hostility from Australia towards Chinese investment.

While the Prime Minister’s comments did not refer to China, they have been criticised by industry groups as “borderline xenophobic” and as likely to send a negative message to Chinese investors.

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Fears grow about Reko Diq Gold mines…Baloch senator says deal offered to China; government denies – by Shaheen Sehbai ([Pakistan] The News International – August 28, 2013)

http://www.thenews.com.pk/

WASHINGTON: While major world mining and investment companies are preparing to invest big time, big money in Balochistan, specially in the mining sector, suspicions and doubts that the biggest gold mine of Reko Diq may be quietly handed over to China as part of the growing economic ties are also coming to the fore.

Official and business circles have been wondering for some time what will happen to the multi-hundred billion dollar Reko Diq gold and copper mines after the world’s largest mining company, Barrick Gold of Canada, was thrown out of Pakistan by the Supreme Court of Pakistan during the PPP regime.

But after the recent visit of high level government delegation to China and a flurry of quick MoUs and super-paced exchange of visits, an important leader from Balochistan, former Senator Sana Baloch has alleged publicly that the government has promised these mines to China in a year or so.

While the Government leaders strongly denied any deal or any promise made during the Beijing visit, an official Pakistan Government statement assuring that the Reko Diq mines will be given to the highest bidder in an international tender is still awaited.

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UPDATE 1-Indonesia may loosen export ban on metal ores – by Rieka Rahadiana and Fergus Jensen (Reuters India – August 28, 2013)

http://in.reuters.com/

Aug 28 (Reuters) – Indonesia will push for a relaxation of its controversial 2014 ban on metal ore exports amid a scramble to support the rupiah and restore confidence in Southeast Asia’s largest economy.

Indonesia is the world’s top exporter of nickel ore, coal and refined tin and its mining industry contributes around 12 percent of gross domestic product (GDP).

However, the ban on unprocessed mineral exports from January 2014 has hit the industry and uncertainties over the country’s mining rules have dented its credibility with foreign investors.

If approved, the reversal of mining policy will upset metal industries banking on a tightening of ore shipments that have increased significantly in the lead up to the ban. However, some in parliament doubted the government would manage to overturn the rule.

Under the proposed revision, mining companies with smelters under construction would be allowed to continue to export unprocessed minerals, but would be charged a progressive duty on the shipments depending on how close to completion their projects are, Industry Minister Muhammad Sulaeman Hidayat told reporters.

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Centerra reports ‘progress’ in talks over Kumtor mine in Kyrgyzstan – by Peter Koven (National Post – August 24, 2013)

The National Post is Canada’s second largest national paper.

TORONTO – After months of political turmoil, Centerra Gold Inc. may finally be closing in on a resolution to one of the mining industry’s most volatile disputes. Reports out of Kyrgyzstan suggest the government and Centerra are nearing agreement on a joint venture to operate the Kumtor mine. The Kyrgyz prime minister said they are discussing a 50-50 split of the project, according to one report.

Centerra cautioned that no deal has been reached, and warned investors not to speculate on the potential terms of a settlement. However, it indicated that talks with the government over its flagship mine are going well. The two sides have been discussing a transaction that would convert the government’s 32.7% stake in Centerra into a direct stake in the project.

“Centerra believes that progress has been made in those discussions,” the company said in a statement Friday. A settlement would be a relief for investors, who have feared the prospect of outright nationalization of Kumtor for more than a year.

The trouble started in June of last year, when a Kyrgyz parliamentary commission released an 800-page report on Kumtor that accused Toronto-based Centerra of massive environmental destruction.

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