Zambian copper project gets the go-ahead

Copper mining company First Quantum Minerals has signed a US$1bn senior-term revolving facility agreement for the Kansanshi mine in Chingola, Zambia.

NLMK puts potential PXF on hold

Russian steel giant NLMK has postponed a potential pre-export financing that it was looking to raise early this year.

Australia: The right place, the right time

Australia’s banks are gaining ground in Asia as European players lessen their activity in the region, writes Laura Benitez.

Sierra Leone steams ahead

 The first shipments of iron ore have left Sierra Leone, heralding a new era of growth for the West African nation. Paige McClanahan reports from Freetown.

Norilsk closes syndication oversubscribed

Russian metals producer Norilsk Nickel has closed its US$1.5bn five-year pre-export finance facility oversubscribed.

BBVA leads Venezuelan steel deal

Venezuelan national steel company EPSSN has won a €480mn loan from a syndicate of banks led by BBVA to finance a steel production project.

Metalloinvest wins Rabobank support

Russian steel firm Metalloinvest has won a US$120mn bilateral pre-export finance facility from Rabobank.

ATB seals metals PXF

Philippine company Platinum Group Metals has closed a four-year US$40mn pre-export finance facility with Amsterdam Trade Bank to purchase new equipment for its nickel mining.

Mexican steel venture gets JBIC nod

Mexican steel company Tenigal has won a US$200mn loan from four local banks to finance a steel manufacturing project in Nuevo Leon, Mexico.

Mechel taps syndicated market

The trading division of Russian metals firm Mechel has pulled in a syndicated US$180mn loan to refinance some of the group’s short-term debt.

Saudi smelter attracts next phase funding

Saudi Arabian mining firm Maaden has brought in more than a dozen financial institutions to fund the second phase of its US$10.8bn aluminium joint venture with metals multinational Alcoa.

Stemcor pulls in oversubscribed revolver

Steel trader Stemcor has oversubscribed its year-long annual revolving credit facility to attract US$205mn in funds.

Norilsk prepares syndication

Russian metals producer Norilsk Nickel is looking to tap the syndication market for a US$1.5bn five-year pre-export finance facility.

UPDATE: Rusal signs jumbo PXF

Russian aluminium producer Rusal has closed its oversubscribed US$9.33bn syndicated pre-export finance facility.

Viewpoint October 12, 2011

Zambia copper, China woe
 

Big moves in Zambia are causing headaches in China. Senior Reporter Michael Turner writes.

In politics, making big moves at the start of a term can give voters time to forget about them when re-election comes around if they go wrong, or let you trumpet them as bold achievements if they go right. At least, that’s one way to explain the moves of Zambia’s new president, and former porter in London’s Victoria train station, Michael Sata.

At the start of October and only two weeks into his role, Sata put the brakes on the US$5.4mn sale of Finance Bank Africa to South Africa’s FirstRand and fired his central bank’s board. A handful of other government bureaucrats were also given the boot.

For exporters, the big shock came when the president suspended metal export permits from Africa’s largest copper producer. This suspension has now been lifted, but its legacy is still causing headaches.

On the face of it, there are only a few government intervention clauses that have been added, such as all exports must now be cleared by the central bank, officials told Reuters. Furthermore, there’s a chance that taxes might go up.

But there are other problems that look like they will take longer to go away. Sata was widely known for his strong rhetoric before election, earning him the nickname of King Cobra. A lot of this rhetoric was aimed at Chinese companies, with their US$2bn investment into Zambian mining, for behaviour that he saw as unfairly exploiting Zambian minerals and workers.

This idea has merit. For all of the investment into Zambia, around 60% of the population live in poverty with a disturbingly-high 37% considered in extreme poverty, according to the World Bank. This suggests that while some are making money from Zambia’s copper, it almost certainly isn’t Zambians.

China’s challenges grew Sata said that foreign firms must do more to respect Zambian labour laws, reduce the number of expats in mines and improve working conditions.

Sata’s rhetoric seems to have rubbed off on his people; a spontaneous and non-unionised strike erupted at the Chinese-owned Chambishi copper mine on the Copperbelt, when Zambian miners demanded higher pay, no doubt buoyed by Sata’s words, even if not his direct consent.

President Sata is playing a dangerous game. It is right for a leader to want better for his people, but evoking non-negotiated strikes, even indirectly, is not the way to encourage continued investment from international sponsors.

Hopefully, being leader of the most copper-abundant country in a continent packed with underground goodies will be enough to make Chinese firms look past these hold ups and let Sata fight for the balance his country needs.

For last week's Viewpoint, click here.