The Japan Bank for International Cooperation (JBIC) has approved a US$466mn loan to Chile’s state-owned copper mining firm Codelco in a bid to secure vital resources for Japanese companies.

Altogether, the deal is worth US$666mn, with JBIC, Japan’s state export finance institution, providing financing alongside an unnamed private financial institution.

The March 28 loan agreement will help Japanese manufacturers to stably import copper concentrates from the Chilean mining firm, JBIC says in a statement.

“In the current trend of decarbonisation, the global demand for copper is expected to increase. This is because the metal is used not only in electric vehicles and renewable energy facilities and equipment but also in applications related to AI and data centres,” JBIC says.

It is “essential to secure” long-term supplies as Japan relies solely on imports for copper concentrates, it says.

The energy transition is set to spur significant demand for critical minerals and metals in the coming decade, yet a US$225bn mining investment gap could lead to supply shortages, UN experts warned last year.

In a bid to secure long-term contracts for minerals such as lithium, nickel and copper, European, North American and Asian governments are increasingly wielding the financial firepower of their export finance institutions.

UK Export Finance, the Export-Import Bank of the United States and Atradius DSB have all rolled out products aimed at securing minerals for domestic producers of goods such as electric vehicles, batteries and wind turbines.

JBIC has a long history of financing copper flows from Chile.

Last year, the ECA approved financing worth US$950mn to secure copper concentrate from Chile. Well over a decade ago, the agency co-financed a US$600mn loan for Chilean mining firm Minera Escondida Limitada, an important supplier of copper concentrate to Japanese smelters.