Month: December 2015

December 31, 2015

Tempus fugit: Jahresrückblick 2015

Here’s a quick overview of what I’ve been up to in the last twelve months.

Greenland

Largely unnoticed by English and Danish-language media, Greenlandic officials visited China during 2015 to discuss not just mining, but also infrastructure projects. Greenland’s coalition agreed soon afterwards on plans to renew existing airports and build new ones, as well as a container port in Nuuk and new hydro-power plants.

Meanwhile, two mining projects which China Nonferrous (中色) has signed (no-strings-attached) agreements to develop and buy into are moving towards getting production permits: GME’s rare earth and uranium Kvanefjeld deposit and Ironbark’s Zn+Pb project at Citronen fjord. If they do go ahead and Nonfezza does get involved, China’s SOE would become (by far) the largest actor in Greenland mining, but it’s too early to toast to that yet (think ore prices, domestic opposition in the case of the uranium project).

For background on Chinese interest in Greenland’s ores, there’s my post from March for the CPI blog. A new post there gave an update as of December, including the remark that the Citronen fjord project could make China Nonferrous (and of course Ironbark) not just the world’s northernmost miner, but their (largely foreign, quite likely Chinese) staff the inhabitants of the northernmost human settlement on dry land at 83°N.

2015 started with news of General Nice (俊安集团) acquiring production rights for the once promising Isua iron ore project. I wrote a long read on that company’s rather peculiar history, including plenty of data you won’t find elsewhere (at least in a Western language). Later updates on General Nice are also worth a look if you follow what is still Greenland’s only Chinese production permit holder.

Russia

Russia’s recent ‘pivot’ perhaps could be more adequately described as ‘away from the West’ than ‘to Asia’; admittedly increased cooperation with China in some domains has been overspun, especially by Russian and Chinese state media, to make up for the fact that trade between the two countries, and crucially between Russia and Heilongjiang, has actually gone down rather drastically. But the fact that Russia, and especially the Far East, needs Chinese investment more than ever before, means potential Chinese investors are being offered better conditions by the Russians (and sometimes, indeed, accepting them).

The Sakha Republic (Yakutia), specifically, has been quite active in trying to attract Chinese investment, for projects such as, first of all, the bridge over the Lena in Yakutsk, but also others like the Tirekhtyakh Тирехтях lead mine at 69°N, to mention one nobody else seems to have reported in English. For more, go check my posts on Yakutia.

Meanwhile in Vladivostok, or actually near it, Russia’s largest casino had its grand opening. As it was to be expected, most customers were from Mainland China even before they started advertising there at all.

Iceland

Other than their projects in Greenland, China Nonferrous also have plans to build an aluminium smelter in Iceland. Their agreement is all non-binding and the plans didn’t look that serious at first, but (again unbeknownst to Western-language media) meetings in China in the last few months suggests they are planning to go ahead with the thing.

In July, car maker Geely 吉利 (Volvo’s parent) agreed to buy a stake in Carbon Recycling International, a methanol fuel producer.

Construction of the joint Chinese Icelandic aurora observatory is, to put it mildly, delayed, but it has finally started and should be working next autumn.

CNOOC (中海油) and local partner Eykon Energy have started exploring for oil in the Icelandic sector of the Jan Mayen area (Drekasvæði).

Ragnar Baldursson, Iceland’s representative at the Wuzhen internet conference last month, had the honour to become the only Western official to be quoted by Chinese media at the event. His comments (actually quite noncommittal) were spun as “high praise” for Xi Jinping’s ‘cyber sovereignty’, freedom-and-order speech.

Norway

The Hålogaland bridge in northern Norway is already being built. The contractor for the steelwork is SRBG (四川路桥), a Sichuan SOE that won that tender in rather peculiar ways. Peculiar enough, in fact, that two people ended up in jail in Germany as a result. My modest investigation on the case is still the only English source of information on what’s the first Chinese transport infrastructure project in the Arctic.

Huang Nubo 黄奴般, poet, mountaineer, tycoon, has given up on buying land in Iceland for now. Plans to buy a plot in Norway are stalled as well, allegedly for political reasons.

Chinese media

Spurred by an article on Icelandic media (viz. Stundin) on China Radio International’s outlet targeting that country, I did some research on the state broadcaster’s ambitious network of ‘borrowed boats’, radio stations and news sites in several languages that help disseminate the views of the Chinese state while staying discreet about their status as part of the state media system. An July article of mine for the CPI blog focused on GBTimes, the arm of that network covering includes Northern Europe.

A Reuters report on CRI’s network came out in November. It had more of a US focus, but it did discuss GBTimes as well. I wrote an update a few days after that, including, as is my wont, some previously unpublished information e.g. on CRI’s affiliate in Mongolia.

A couple of weeks ago, CRI got a new partner, this time in Siberia. That partner also has an interesting background, in particular as a defence contractor.

Languages

All this reporting wouldn’t be possible without (often rather unrewarding) work on original-language sources, in English and Chinese of course, but also in Russian, Korean, Danish, Icelandic, Norwegian, Mongolian and a few others. Those specifically interested in the linguistic angle might like my recent guest post on the names of the Lena river on Language Log; more than my post, I recommend the comments, where you’ll find remarks by experts in Tungusic and Yukaghir.

December 25, 2015

update on General Nice and Burkina Faso

The transitional government of Burkina Faso has authorised Frank Timiș’ Pan African Burkina to resume manganese exports from their Tambao mine. Their export license had been suspended in March over the company’s alleged failure to invest in road and railway infrastructure (Jeune Afrique).

The reason this appears in an ostensibly Northern-looking blog is that the Tambao mine used to belong to a subsidiary of General Nice Group (俊安集团), the current owner of the (dormant) Isua iron mine in Greenland. General Nice conducted exploration activities at Tambao through 2012, and, at least according to their interpretation of the license agreement, had exclusive rights to take the mine to the production stage. The government of Blaise Campaoré (who had been president since 1987) begged to differ, and instead resold the mine to Timiș, a Romanian-Australian miner.

It probably speaks in General Nice’s favour that Campaoré had done more or less the same thing before: rights to explore the mine had first been sold to UAE-based Wadi Al Rawda before the Campaoré administration decided to sell them again to General Nice. The Emiratis sued at an arbitration tribunal, a dispute settled in 2013. General Nice also sued when they were in turn deprived of their permit. Quite unusually in the context of Chinese companies in Africa, a rather strong-worded campaign was launched on Facebook and local media defending General Nice’s position and accusing Campaoré and his entourage of corruption, as described in my background article on General Nice.

Compaoré was ousted in 2014 and fled to Côte d’Ivoire. The transitional government announced it would revise mining contracts signed by the previous administration, such as the award of the Tambao permit to Timiș’ company. With their nemesis Compaoré in exile (and just issued an arrest warrant) and Timiș prevented from exporting, things were starting to look better for General Nice. Talks to reach a settlement (GN are claiming $50m in compensation) started again, and as of last July the country’s Council of Ministers was voicing its will to “continue negotiations” with GN “in order to reach a definitive settlement of the dispute”.

A new president, Roch Marc Chistian Kaboré, has just been elected and will be sworn in next week.

December 21, 2015

CRI gets new Siberian partner

China Radio International (CRI) have signed an agreement to have their content broadcast through a regional network of radio stations in Siberia, reports Justrecently channelling CRI themselves. Their new Russian partner, MKR Media, is led by Ivan Polyakov, an Omsk-based businessman who chairs the Russia-Hong Kong Business Association and vice-chairs the Russian-Chinese Business Council (Российско-Китайский Деловой Совет, 俄中双边企业家理事会).

Cooperation between Chinese and Russian media organisations has intensified during 2015, and plans are for it to intensify even more during the next two years, named the “Years of Russian and Chinese Media”. Case in point: the Sino-Russian Media Forum last June in St Petersburg, whose (Chinese) motto was “Joining forces to tell the two countries’ story well” (sounds better in Chinese: 合力讲好两国故事), an elaboration on Xi Jinping’s ‘tell-well‘ catchphrase. Last month, Boris Gryzlov, former Duma speaker and a senior figure in Russia’s ruling party, suggested that the two countries should create an international news agency “tasked with conveying to a broad audience current information matching Moscow and Beijing’s interests.”

CRI has surely plenty to learn from its Russian counterparts. Outlets such as RT and Sputnik News have been, shall we say, more successful in entering the global media ecosystem than CRI’s own network of ‘borrowed boats‘.

CRI’s new Siberian partner, MKR Media, was established last year as the media branch of MKR, one of the largest companies in Omsk oblast. It controls regional TV and radio stations, including Radio Siberia (Радио Сибирь), the sender that has just partnered with CRI to broadcast China-related content and help promote CRI’s “Nihao China” («Здравствуй, Китай» 你好，中国) project. Radio Siberia’s stations cover most of the populated area of the Siberian Federal District, from Tomsk to Chita.

MKR (ОАО «Межгосударственная корпорация развития» or Interstate Corporation for Development) was created with the goal of “developing cooperation in science, industry and high technology between CSTO [aka ‘Tashkent Pact’] countries”. Here’s some information in English: Sputnik on their anti-wiretap system, RT on them sponsoring a Faberge egg exhibition in China, and indeed their own English website. In 2014 MKR bought a majority stake in a company behind the project to build a new airport at Fyodorovka near Omsk, a project now all but dormant.

MKR is (or was until recently) majority-owned by Relero aka the Popov Radio Factory in Omsk (Радиозавод им. А.С. Попова), established in 1948. The Popov Radio Factory is mainly a defence contractor whose products include telecommunication equipment (most recently in use in Russian bases in Abkhazia) and drones (such as the the Iskatel Искатель or ‘seeker’).

Ivan Polyakov led the Popov Radio Factory for years, before handing the reins to his sister a few months ago. He remains at MKR’s helm. Some of his recent activities, including the acquisition of company behind the airport project, the foray into the media industry and indeed the increased participation in contacts with China, have been attributed by local observers to his political ambitions (specifically plans to become mayor of Omsk).

December 18, 2015

state media: Iceland representative “highly praises” Xi Jinping’s speech at Internet conference

Iceland sent a representative to the world Internet conference in Wuzhen 乌镇 near Shanghai a few days ago, an event meant to advance the Chinese government’s views on ‘internet sovereignty‘. Xi Jinping’s opening speech, which included such phrases as “freedom is what order is meant for”, received what the People’s Daily calls “high praise” from foreign attendees including an Icelandic embassy official. Iceland was not the only country to send embassy staff to the event, but theirs is the only Western official I’ve seen quoted in state media reports on it.

The comments came from Ragnar Baldursson, minister-counsellor at the Icelandic embassy in Beijing. Ragnar is an old China hand who studied in China in the 1970s and has been working at the embassy for two decades.

Although spun by state media into something of an endorsement, Ragnar’s actual comments don’t specifically praise Chinese internet policy but simply highlight the increasing importance of the Chinese internet.

December 9, 2015

Greenland airports: possible Chinese investment?

All three parties in Greenland’s ruling coalition, Siumut, the Democrats and Atassut, have signed a “historic” agreement on infrastructure development that envisages expanding two existing airports and building three new ones as well as building a container port in Nuuk and new hydroelectric power plants. The guidelines sketched so far favour building several of these projects through public-private partnerships.

Infrastructure projects, and specifically airports, have been discussed in talks between Greenlandic authorities and potential Chinese investors. Such talks received a good deal of media attention in 2012, but didn’t stop there. During a visit to China last October, Vittus Qujaukitsoq, a minister whose portfolio included finance and trade, explained Greenland’s development plans to representatives from Sinohydro (中国水电), China State Construction Engineering (CSCEC, 中建) and China Harbour Engineering (CHEC, 中国港湾) among other companies. Besides airports, Vittus talked about hydraulic and mining infrastructure projects. The meeting, which appears to have gone unreported in Danish or English-language media, is a sign of continued Chinese interest in investing in Greenland. The coalition partners’ proposal, unveiled just over a month after Vittus returned from China, will surely make a lot more sense if backed by a degree of serious interest from Chinese SOEs.

Prospective Chinese investors might be less happy to learn about the controversy some aspects of the airport plans could generate in Greenland.

At any rate, the first Chinese investor in Greenland could be integrated miner China Nonferrous (中色), if metal prices keep the momentum behind the Citronen fjord and Kvanefjeld mines. Having one Chinese company there could help generate enough confidence for others to follow (and indeed China Nonferrous’ chairman has recently talked of the company playing such a pioneering role in Iceland).

December 8, 2015

Chinese-Russian ‘intergovernmental commission’ to discuss Yakutsk bridge: Russian sources

An “intergovernmental commission” including vice-premiers Zhang Gaoli 张高丽 and Igor Shuvalov will look into proposals for Chinese companies to build the long-awaited bridge over the Lena river and join Yakutsk to the Russian transport network. That’s according to a press release from the Yakutian railway company ОАО (behold the nested quotes: ОАО «АК „Железные дороги Якутии“»), jointly owned by the federal and Yakutian governments. This information has been reflected in media reports by Interfax and others, but so far all Chinese reporting is just sourced to Sputnik’s Chinese service.

The information about the remarkably high-level involvement comes in the context of an agreement signed a few days ago in Moscow between the Russian side and Sinohydro (中国水电) and somehow related to the construction of the bridge. Again, this information is still based only on Russian reports, and not of the highest quality (as evidenced by a miscyrillisation of the name of Sinohydro chairman Song Dongsheng 宋东升 in the Interfax story, a sign that suggests reporting involving no Chinese expertise).

I’ve discussed the background of the Lena bridge project in some detail in the past. In a nutshell, long-term interaction between the Sakha Republic (i.e. Yakutia) and Heilongjiang governments, originally mediated by private businesspeople, has led to increasingly concrete plans for Chinese contractors to build the much-needed bridge, but funding from the Russian federal government failed to materialise after Crimea’s accession to the federation reshuffled infrastructure development priorities. While the Yakutians have been actively looking for Moscow and/or the Chinese to finance the bridge, the federal government seems to need some more convincing. For an analysis of how much importance Chinese (and specifically Heilongjiang) government entities are likely to attach to infrastructure development in the Russian Far East, you’ll have to wait for my forthcoming writeup on the topic.

December 7, 2015

update on mining in Greenland

Chinese interest in mining in Greenland hasn’t received a lot of media attention this year, after General Nice (俊安) bought the Isua iron mine, which probably no one would think of developing at the moment (‘cucurbitae caput non habemus‘). That doesn’t mean Greenlandic officials have stopped promoting the island’s ores to Chinese potential investors (there have been meetings in October), or that Chinese interest no longer exists; quite the contrary. As two projects China Nonferrous is expected to help finance and build approach the production stage, Chinese investment in Greenland could become a reality pretty soon.

My latest piece for the China Policy Institute blog discusses these developments.

December 3, 2015

Chinese-Icelandic aurora observatory should start observing auroras next fall

The Chinese-Icelandic aurora observatory (CIAO), a joint Chinese-Icelandic project located at the Kárhóll farm in Reykjadalur, near Akureyri, is reportedly already under construction after local company SS Byggir won the contract for the main building. That, together with a recent visit to the area by the Chinese ambassador, augurs well for the project, that was already supposed to be ready more than a year ago.

Observation activities should begin in autumn 2016.

More on the observatory and the people and organisations behind it in my previous posts on the subject.

December 2, 2015

update on China Nonferrous’ Iceland Al smelter project

China’s ambassador to Iceland Zhang Weidong 张卫东 was at China Nonferrous (中色) headquarters in Beijing last week, where he discussed the company’s aluminium smelter project in Iceland with chairman Zhang Keli 张克利 and Wang Hongqian 王宏前, second in charge at Nonferrous’ listed arm NFC. The ambassador highlighted the importance of the project, whose success could set the ground for more Chinese companies to take part in similar endeavours in the future. Chairman Zhang talked of China Nonferrous’ responsibility as a central SOE whose projects abroad, besides their economic significance, are important for the country’s image and foreign relations.

China Nonferrous’ formal commitment to the project so far has the form of what I understand is a non-binding agreement between NFC (中色股份) and local company Klappir Development, signed last July. The Chinese embassy has been involved all along, declaring their support for the project as early as 2013. The Chinese ambassador was present at the signature of the agreement in July, and a few days later toured the site of the projected plant and met with municipal government representatives.

In September, an Icelandic delegation paid NFC a visit in China. They were taken on a tour that included Jinjiang 锦江 Group’s aluminium smelter in Holingol (Chinese 霍林郭勒 Huolinguole, Mongolian Qoolin gool* Хоолингол) in Inner Mongolia, and two Shenyang-based companies controlled by China Nonferrous: NFC Metallurgical Machinery (中色沈阳冶金机械有限公司) and Northeastern University Engineering and Research Institute (NEUI, 东北大学设计研究院). The Icelanders are reported to have praised Chinese aluminium smelting technology and its high environmental standards.

Meanwhile in Iceland, Klappir are expecting to announce the start of the project next spring. NFC’ Wang talks of the Chinese and Icelandic sides both working for construction to start soon.

China Nonferrous are also active in Greenland. With the important proviso that their agreements there are also non-binding, they look poised to become the world’s northernmost miner at the Citronen fjord Zn+Pb project, in partnership with Ironbark, as well as GME’s partner at the Kvanefjeld U+REE mine. Both projects are advancing towards the production stage.

(Hat tip to Hjálmar Friðriksson.)

*This blog will implement Mongolian script toponyms as soon as I figure out the font and display issues. So far I’m going with the usual transcription. Here’s the name in Balk-Janhunen Romanisation, which I think deserves more publicity as a true transliteration system: Quuliv qhuul.