Nonferrous Minerals Getting Day in the Sun

Nearly a decade and a half after the US and China established formal diplomatic relations, and two decades after the two countries signed the Shanghai Communique and established commercial ties, the world, and perhaps China itself, has discovered that a wealth of natural mineral and energy resources lie beneath China's soil and directly off its coast. The country's coal reserves and oil and gas potential are well known. Its ferrous and nonferrous metal reserves are respectable and in a number of instances pre-eminent. According to 1981 Minerals Yearbook estimates - more often than not below those now being claimed by China - the country's aluminous metal reserves are about 907 Mt (1 billion st); iron ore reserves are 40 Gt (44 billion st); and copper reserves are about 46 Mt (54.4 million st) of contained metal. In addition, the country has about 10.7 Gt (11.8 billion st) of phosphate reserves, the fourth largest in the world, and 3 Gt (3.3 billion st) of pyrite. China's national Sixth Five Year Plan promulgated in late 1982 ended a stringent three-year retrenchment or readjustment period in which a number of major development projects involving foreign participation initiated in the late 1970s were shelved. The new Five Year Plan is a signal both within and outside of China that things are now moving again, and that major industrial and service sectors are receiving the kind of funding and flexibility they need for expansion, construction and modernization. The new plan's strategy for growth is measured and much less grandiose and frenetic than it was five years ago when China flung open its doors to foreign companies and invited participation in large-scale development projects. Now, the country's reticence to spend foreign exchange to purchase key equipment, technology, and services -a reaction to these projects and the spending they entailed - is clearly on the wane. In China's effort to quadruple its GNP by the year 2000, there is a new willingness to use some of its substantial foreign reserves. In fact, it is projected that 1983 will witness a $1.9 billion deficit, with a $2-3 billion deficit in 1984 and 1985. The following article discusses implications the Sixth Five-Year Plan has for nonferrous metal development in China. It is the first in a series of three articles on Chinese mineral resource development to be published in Mining Engineering over the next few months. The second article will identify specific nonferrous projects underway, while the third in the series will focus on trade and development opportunities for phosphate and potash producers in China. China's Ambitious Plans In the last few months, the exploitation of China's nonferrous resources and development of its industrial processing capabilities have begun to receive increasing attention on both provincial and central levels. Unlike the earlier modernization drive of 1978 when China's ferrous sector - best typified in the Baoshan iron and steel project - got the lion's share of the Ministry of Metallurgical Industry's (MMI) energy and resources, it now appears that in some respects the nonferrous and industrial sectors are finally moving out from beneath the dominating shadow of ferrous and getting their own day in the sun. Separation of Nonferrous from Ferrous One clear demonstration of this is the establishment in April 1983 of the China Nonferrous Metals Industry Corporation (CNFMIC). The corporation is composed of 819 enterprises with over a million workers, and also includes 12 nonferrous metal construction companies, eight design institutes, and three prospecting companies. Of ministerial rank, CNFMIC is responsible for the development of both the country's nonferrous resources and its processing facilities. Although closely tied to the parent ministry from which it sprang (i.e. MMI), CNFMIC, at least theoretically, is separate and independent from it. One strong indication that this independence is, or soon will become a reality, can be seen from the fact that the new corporation is not headed by the former MMI officials, not even those who made up the ministry's now defunct nonferrous bureau. Instead, its president Qiu Chunfu is formerly of the State Economic Commission and the China International Trust and Investment Corp. Its general manager Fei Ziwen, an engineer in his early 50s, is from the Jiangxi Province Copper Corp. The new nonferrous corporation appears to be powerful