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Canada orders three Chinese firms to exit critical minerals deals

Canada orders three Chinese firms to exit critical minerals deals
© Reuters. FILE PHOTO: A Canadian flag flies in front of the Peace Tower on Parliament Hill in Ottawa, Ontario, Canada, March 22, 2017. REUTERS/Chris Wattie

OTTAWA (Reuters) -Canada’s government ordered three Chinese firms on Wednesday to divest their investments in Canadian critical minerals companies on grounds of national security.

The three firms ordered to divest their investments are Sinomine (Hong Kong) Rare Metals Resources Co Ltd, Chengze Lithium International Ltd, also based in Hong Kong, and Zangge Mining Investment (Chengdu) Co Ltd.

The government ordered the divestiture after a “rigorous scrutiny” of foreign firms by Canada’s national security and intelligence community, Industry Minister Francois-Philippe Champagne said in a statement.

Sinomine was asked sell its investment in Power Metals Corp, Chengze Lithium asked to divest itself of its investment in Lithium Chile Inc and Zangge Mining is required to exit from Ultra Lithium Inc, according to the statement.

“While Canada continues to welcome foreign direct investment, we will act decisively when investments threaten our national security and our critical minerals supply chains, both at home and abroad,” Champagne said.

Last week, Ottawa said it must build a resilient critical minerals supply chain with like-minded partners, as it outlined rules meant to protect the country’s critical minerals sectors from foreign state-owned companies.

“The federal government is determined to work with Canadian businesses to attract foreign direct investments from partners that share our interests and values,” Champagne said.

Canada has large deposits of critical minerals like nickel and cobalt, which are essential for cleaner energy and other technologies. Demand for the minerals is projected to expand significantly in the coming decades.

Earlier this year, Canada, the United States, Britain and a few other countries established a new partnership aimed at securing the supply of critical minerals as global demand for them rises.

Source: Investing.com

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